Wood River times. [volume] (Hailey, Idaho) 1882-1915, 1885-10-17
TnE vALUED.POLlCY LAW.

Reasons Why 1t IL BAa aud Insp.
erative.
The following letter, written a few
weeks ago, was the cause of the de.
feat OF the "valued.policy law" in the
Georgia Legislature:
Hon; Martin Y. calvin. Member Of Ise,.,.,,...
State Of Georgia:
DEAR SlR-Yours of the l4th duly
received. As you suggest, the people
OF this State rare in an exceedinalv
bad way" Every licensed FIRE insur.
ance company has cancelled its agen.
clos, called home supplies, and with.
drawn from the State, aud l am lust
informed that about IS other GONNA.
hi.s are pledged not to write \ policy
for a citizen OF this State. A few
companies are canc.lling policies, but
this IS not yet general. For home
companies we are limited to one stock
and few small mutuals; consequent.
~ manufacturers, traders and business
parties generally, including the banks
who hold heavy amounts Of policies as
collateral, are, or soon will be, literally
without insurance. Strong men Of
wealth, the accumulation Of years Of
industrious toll, are soon to be At the
mercy OF the devouring element. The
situation may be partially imagined,
but not easily described. 1t is in con.
temptation among business men to
petition the Governor to convene the
Legislature to repeal tn. law, while
average citizens who have only their
shelters to insure largely oppose the
movement. The future: therefore, is
in doubt. l enclose copies Of the re.
cent enactments. You will notice
that they are compilation of the
most offensive legislation touching in.
surance that exists in all the States;
no single State except this having
adopted the whole batch; still the val.
ued policy is the whole bone of con.
tention. Insurance capital is becom.
ing very sensitive As to the introduc.
ton Of this principle. Their expert.
ence in States where it has been adop.
ted confirm their worst fears in rela.
ton to it, and they feel compelled to
make a stand against it in solf-de-
Tense, and for the protection Of their
customers. The valued policy has
been put forth as remedy for over.
insurance, which is unquestionably a
great evil. This, however, is not the
first instance where a proposed rem.
cdy has aggravated the disease. A
little reflection must convince any
one that such law invites and facili.
tates the evil it is SO desirable to
aba,e; it provides that the sum named
in the policy as limit, 90 matter how
many manipuIa,ions, Measurements,
concealnents or subterfuges may have
been devised to obtain it, shall be
paid, although it may BE- twice the
value Of the property destroyed.
know it is often ilippantly said per.
son should have all the insurance he
pays for, ignoring the idea Of indem-
nifty. With the unreflecting, this
phrase passes quite current; but will
it bear moments investigation? Fri
marily, in nine cases out of ten, the
owner is the best Judge of the value
of the property; if he pays for more
insurance than It is worth, he does so
valontarily and for some purpose
there is no compu!sion, however de-
relict as to his duty the agent may
be. This over insurance, when OBJ.
tained, at once takes away his interes,
in the preservation Of his property; il
makes it worth more to burn than to
keep, and therefore invites him to ap-
ply the torch. To substitute the val.
ued policy for the indemnity contract
is to substitute carelessncss for care
incentive for precaution, knavery foI
virtue, and to increase the moral haz'
aid without limit. Under this law
dishonest agents and property owners
may connivc together and sell undo
sirahle pre- perty to insurance compa
MES for double its value, and the
companies are practically estopped
from exposing the fraud and protect
ing themselves as well rs the public
who eventually do all the paying, fol
! every fraud even enters into the pre-
miums we pay for insurance.
, The valued policy proposes te
+ change the simple indemnity contract
aga nst loss, which has been the Theory
and practice Of insurance ever since
its origin, into speculative contract
and is in direct opposition to the
> whole tenor of the decisions of the
courts in this country ard in England
which have uniformly held that the
possible recovery Of more than III.
value of the property destroyed or los
. is against public policy, and injurious
+ to public morals. This measure it
effect offers a premium for fraud. i
. furnishes the honest portion OF tn
r community with increased burdens
and shields the roRues with their i'll
gotten booty. 1t makes contracts ar
. bitrary which have heretofore beer
open to adjustment by disintereAte'
, neighbors, or an appeal to the codrts
i ~