The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1885-08-25
FIRE INSURANCE.
Indiana as an Insurance Field-Startling
Growth of Incendiarism.
% Appear in Rough Notes for August.

fortunate field for fire underwriters, and the
existence of this fact at the present time is a
great misfortune to the State. The causes that
work harm to the companies retard prosperity
the same as war; pestilence or other misfortune
that makes it necessary to raise large amounts
Of money by taxation. Heavy taxation. without
remuneratlve return means reduction of values,
and has never yet met with favor among any
people. We 90 not mean TO imply that the sue
cess or failure of the insurance companies to
make money is matter of moment in any State
so little interested in insurance capital as In
diana. but believing the same circumstances
affecting fire underwriting also in large degree
retGrd the prosperity of the State their existence
becomes a common and widespread calamity.
ne State, except IN moment of peril never
makes extraordinary disbursements without
serious consideration, earnest discussion and
finally vote by the people or their
representatives, yet extraordinary losses
are sustained year after year, for
decade at time, without raising an inquiry
regarding their effect upon the public welfare,
or any means being used to arrest them. The
premiums paid for FIRE insurance in Indiana are
serious tax, amounting to nearly So l25 900
annually as shown by the reports of the Auditor
Of State. If with this amount of revenue the
companies are unable to pay their losses in
Cured in the State, and the expenses incident to
the business. it means that property owners
must raise a larger revenue-in other words, pay
a heavier fire tax if the cost of the annual fire
waste is to be borne largely as heretofore, by
insurance Formerly the companies secured
fair profit upon the business transacted in In
diana, but recently it has been counted a lucky
company that at the end of the year could show
a reasonable gain from fire underwriting in the
State. In the aggregate the results have been
bad. There has been no lack of effort on the
part of the companies to make money. Capital
has been eager for remunerative returns.
Agents have been 'braced up" to advance
rates, local boards have been formed and main
tanned, compacts established in the larger CT es.
the State Association of Fire Underwriters has
been earnest and efficient in its work. and all
that associated effort on the part OF the compa-
MES could do to make fire underwriting profitable
has apparently been performed; yet the high
tide OF misfortune appears not in the least
abated, and the heavy drain upon the resources
and energies Of the people continues without any
return in value for their vast outlay of money,
the functions of the companies ceasing when
they have fairly distributed the burden among
those who insure and paid the losses they have
sustained. With increase of fire waste and
necessary increase in the cost Of insurance
comes resistance to increase of premium rates
as against increase OF any form of taxation on
the part of those taxed. This resistance
finds its way into the legislature and attempts
made in several States successfully, in
adding to the burdens of the companies,
only increase the evils complained of. AS
yet little has been done in any State to abate the
evil itself-that of the increasing fire waste.
nothing can be done until the public is thor
oughly enlightened regarding the causes that
work a loss to the State Of several millions of
dollars annually by the burning of insured and
uninsured property Let it be remembered that
while the people of Indiana during 1884 paid
over 81, 000, 600 in premiums to the insurance
companies which in turn distributed ST. 624, 500
among those who met with fire losses, the real
loss In actual money value to the people Of the
State was So $50, $50, as shown by the Chronicle
Tables. where a q n
compilation of the losses by fires for
the past ten years in the United States
and Canada is to be- found. The first
step towards reducing the fire tax that of ascer-
tanning its amount, has been taken. The public
is indebted to the insurance companies, and
their co-laborers, the insurance journalists for
taxing this step, but the value of the informa-
ton furnished is not yet appreciated. Another
advance has also been made, that Of studying
and classifying the causes of fires, not
rately, but approximately, as no existing law Of
the State affords authority for holding fire in
quests or lnstltutlng any Judicial examination
into the causes OF fires, unless some one is direct
ly accused of the crime Of arson. Thus, taking
the ascertained causes of fires in Indiana during
1884, we find that 50 per cent were of lncen
diary origin Stated plainly, the fire insurance
companies paid $844.7 rs, and the State lost
ST.. ~, 693 by the torch of the ncendiary.
This red-hot fact should be burned into the
MIND and recollection of every legislator and
tax payer in the State until laws are enacted
the
cause of every fire loss that occurs. and
make it a punishable offense for any fire
insurance company to pay loss on property
destroyed or damaged by fire until authorized by
the local authorities, and not then for an amount
exceeding three fourths the actual loss sustained
Dung the past ten years Indiana has been com
peLed to overcome a loss by fire waste exceeding
$23 0OO 900 before making any advance in ma
terial prosperity. and incendiaries have cost tax
payers 10000, 600 within this brief period The
Wh0lpc NV Jior
upon the premium rate paid by policy holders is
easily seem Insured property alone could
well afford to pay for the new Stare-house now
being erected. and present it free gift to the
State, II by so doing they could be relieved of
the tax they pay for incendiary fires during the
brief space of three years. Remove this evil,
and the insurance companies could abate their
revenues from the State $500 600 annually and
count 100000 profits on a business now attend
ed with constant loss. The local effect of in
cendlarlsm upon certain sections of the State is
serious
Some companies will not now write upon farm
property anywhere in certain districts, embrac-
ing whole blocks OF counties. Having lost so
heavily upon this usually profitable class of
isolated risks, they continue the fight with
the ncendiary no longer. One leading company,
some three years ago, surrendered its farm
business in large portion of southern Indiana
by quietly discontnuing issuing policies
therein. Another leading company, anxious
to secure as much as possible of the
'cream of the business as farm risks are gen
orally regarded. gathered in as rapidly as posi-
bic the expiring risks of it's competitor, but an
experience of less than two years compelled this
company to peremptory order halt and
cease writing new business, and finally the ex-
perience of third strong company that for the
first half of 1885 has been buslly engaged taking
up the lines laid down by the other two com
panies is a recorded loss of 20 per cent of its
entire premium receipts taken in the State from
January to June inclusive. With this expert
ence in connection with the Insurance of isolated
farm dwellings and barns, risks that have been
eagerly sought after by the companies, it is not
difficult to perceive the effect of incendarism on
premium rates for insuring business and
specially hazardous property especially in local
tiles where police regulations and facilities for
extinguishing fires are imperfect tits no wonder
that rates have advanced, but the wonder is that
with the Lar oht lid IN do