The Austin weekly statesman. (Austin, Tex.) 1883-1898, 1885-02-05
INSURANCE MEN.
THE BOARD OF UNDERWRITERS
HOLD AN IMPORTANT, CON-
FERENCE, YESTERDAY,
And Urge Upon a Joint Commit
tee OF the Legislature a
Change in the Law.

Inc executive committee oil tls
state board of underwriters, held an
Important session yesterday afternoon
with joint committee of the legisla.
ture, touching the necessity Of repeal
Ing the insurance laws now in force in
Texas. The meeting was held at the
capitol, and among the insurance me1
present were; y. o. Lauve, president
state board Of underwriters, Austin
j. L. Trezevant, Jr., ex-president
Dallas; j. NJ. Cotton, Houston; Ii. G.
Dunn, Dallas; a. Kenison, Galveston;
VIM. Bowen, Austin; j. b. T. Hall
Dallas; J. L. Murphy, Dallas; a. e..
Campbell, Austin. The joint COM
hlttee of the legislature Insurance end
statistics) consisted of Senators Gar
rison, GetZendaner and johnson, and
Representative Alexander, Fisher
and Underwood.
Mr.. Alexander was called to tie
cnalr, and in opening the proceedings
stated that the meeting was called
Tor the purpose of hearing the views
OF the insurance men OF the state,
through their representatives now
present. lie regretted there was not
a larger attendance, but he hoped
their numbers would be augmented
before adjournment. He then in
PRODUCED
MR.. J. T. IRRELEVANT,
who delivered an able and argumenta-
tive speech in favor of repeating the
present insurance law. In the course
of his remarks he said it was the
desire of himself and his associates
to show the evils which affect the in
GIIrlnRa hn
apprehension entertained by the great
bulk OF the pes PIE as to the modes by
which the companies transacted their
affairs. At the outset he would like
for his hearers to bear in mind the fact
that the contract of insurance ought
to be one of simple indemnity and no.
thing more. The province of an in
Surance company was TO cOllast prem
iums for the benefit of unfortunates
who lose their all in conflagra-
lions that cannot be avoided.
He then entered into an elaborate
statement OF the effect of the legisla-
ton now on the statute books so far as
it related to theinsuTancei nterests,aad
said that, while he cheerfully exoner-
ated the gentlemen, WAC passed the
law from any intention to do wrong
nevertheless the practical effect of the
act OF four years ago was TO put
premium on arson and drive from the
state every insurance company
that had been doug business here
Insurance was now absolutely neces-
sarY to business. 1t protects and fos-
tiers 1t, and is, in fact, the hand maid
of commerce. Tie policy system at
present in vogue was as perfect as
anything human could be, and, while
it might sometimes be erroneous in
minor matters, IN the main il was all
that could be wished, and had given
almost universal sati, faction. But
the laws which were now in force in
Texas on this question were such as
prudence or justice cannot sanction,
for under their influence crime had
been encouraged, rates of insurance
had become extremely and oppressive
ly high, and the fire ratio in Texas
had increased to such an alarm
ing extent that it was to-
day three times greater than
any other state in the union.
Companies had no protection against
the designing and the dish n
est. The man who was rascal enough
to perpetrate fraud could insure a
house for $1,000 that was valued only
at $1,000, and as soon as he wanted to
get out of business his premises went
up in smoke and ashes. Under the
present law this man could not only
recover the amount of his actual loss,
but he could compel the companies to
pay the fictitious value he fraudu.
lently placed upon his premises. Thus
the statutes of Texas did what their
authors never intended-they posi-
lively encouraged fraud and arson.
They all knew that this same crime,
thus fostered, was one of the most
difficult in the whole category to
prove Or establish, for in
the destruction -ef-the- pro-
erty pefished Gin nearly all cases)
the only evidence upon which con-
viction could be had. Thus the state
had opened wide door for fraud, and,
although the underwriters and their
agents had done all they could to pre-
vent the system of oveT-insGrance
referred to, it was impossible to guard
against the frauds of men who pur-
posely misrepresented the value of
their property, and who seemed to. be
abetted in all their evil designs by
what had proved to beEan entirely one
sided law. The speaker here referred
to the three-fourth policy of insurance,
and said it was system all the COM
panies favored. In reply to Mr.. Under
wood, he explained that, il effect, this
policy sought to give the insurer and
insured a joint interestin guarding the
property of the latter. Where mans
premises were insured for 81, GOO, and
happened to be destroyed, the man
who owned the property suffered a
loss of one-fourth while the insurance
company bore the other three-fourths.
This made it OF mutual interest to
both parties TO observe solicitude
and care which would not be felt if
the responsibility was all on one side.
1t was the only safe system, and it
was the true policy for sound legisla-
ton to favor. Referring to the indif-
ference with which certain property
is handled, he called attention to cot,
ton, and Illustrated his argument by
stating that the small boy with his
cigarette, or even the tramp, could
set it on fire at pleasure, so far as the
WatchfulnesS of the owner was con-
cerned once it had left his hands and
was insured. MIR. Irrelevant was
at this point interrupted by Mr.. In
derwood, and asked why the insurance
companies did not definitely fix the
value of property at the time of in
surfing it, and thus avoid all room tor
contest afterwards. He replied that
they had been in the habit of accepting
the estimate of value placed by the
owner upon the property insured, and
for this reason that no man knew its
value so well as the owner. Who, for
example, could tell the exact value of
MIR. Driskill's residence in Austin
He did not think any two builders in
the city could be found who would go
within 5000 of it, or 5000 of each
other. And so the agents were almost
absolutely bound TO accept the esti-
mates of the parties inSuring. There
was no escape from it, and all would
be well if the law did not hold out q
standing Invitation to those who
were inclined to be dishonest to put
false value on what they insured
BY reason of that fact every insurance
company doing business in the stat,
had been steadily loosing money. Not
only that, but every time dishonest
man over-insured, an injury and hard
ship was done to his honest neighbor
The rascal could burn up his house, anC
by so doing get good deal more thar
its real value, because he had it eSti
mated in excess of its worth, and be-
cause legislation favored his schemes
but the honest mantle poor fellow
whose premises this same rascal Nigh
destroy IN burning up his own-wha
-.-~.,lI- hooopao of him ETa wac ths