The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1893-12-24
INSURANCE RATES.
They May be Materially Increases
Throughout the Territory.

Within the next month the rates Of
insurance in Salt Lake and Ogden, and
probably throughout the entire terri
tory. may be materially increased.
During the past week or two the Pa
cific Insurance Union has held a num-
Der of meetings at San Francisco for
the express purpose of discussing the
Utah rates and in view of ahe many
fires which have occurred in this terri
tory during the past year, large
number of which have been of very
suspicious nature. it is said to have
been practically decided to make an
increase in the rates OF course the
local agents will fight the proposition
but they will be powerless If the
Union which is a combination OF all
companies doing business on the coast,
decides upon the increase. The lnsur-
ance companies side of the case is
ably set out in the following from an
insurance paper of San Francisco. pub
Iished by one of the largest insurance
agencies in the world:
Recently we received letter from
one of our large agencies, asking US to
grant some concessions in regard to
the credit rule. Our reply. which we
give herewith, may be of interest TO
others who contemplate similar re-
quest:
San Francisco, Nov. q, 1888.
Referring to your esteemed favor of
18th inst, received this morning, would
say that there is no doubt that 1t is
a very good presentation of one side
of the insurance situation. There is
another side or perhaps more than one
side which has, or have TO be taken
into consideration. One is that the
losses throughout the United States
have never before been so severe as
this year. During the first ten months
they exceeded those of the same period
for last year by upwards of $26. 600, 900,
notwithstanding that last years losses
were heavier than those of any pre-
ceding. All these extraordinary claims
have to be met as they mature. Com
panies pay losses out of collected prem
liurns, not from their investments.
Should collections be unusually difficult,
then they are obliged to dispose of
some of their securities You know as
we'll as we, the depreciation in all class
es of securities, and that it would be
ruinous to an insurance company to
have to part with any considerable
amount during the present depressed
condition of things. They say No,
we will not sacrifice our securities.
Our bills receivable equal or exceed our
bills payable; we insist upon one hand
washing the other"
1
sidered, and that is that individuals,
firms etc, are not as solvent now as
they were a year ago. 1t is dangerous
| TO give much credit. During the past
three years the companies have been
losing money, all of them The amount
sunk in the fire insurance business
in the United States during that period
runs into the millions. There is not a
single company that we know of. will
In RI ir7pcril ffc for I-e
of retaining its premium income. The
position is such that unless the -busi-
ness turns a corner very soon and as
sunes a much more favorable aspect
very large proportion of the COM
panieS will diSband and restore the
capital TO stockholders. who can make
much better use of it in other direc-
tons. The disposition today is to con-
duct the affairs of an insurance COM
pany very much more on the principles
| of a banking business than heretofore
The officers are Indifferent as to the
growth or Shrinkage of the premium
income, but, keenly alive to the neces-
sity of reducing expenses and for re
storing the business to something like
absolute cash transactions. 1t is not so
much a question of trying to retain the
lclientage as of self preservation. There
are other points of consideration, but
these are the principal ones which are
influencing the companies towards in
sisting Upon the abolition of long cred
its and more particularly so in this
panicl1y and uncertain period The
underwater who goes east and confers
with insurance managers there, finds
that a complete change of feeling has
taken place. The question asked OF
such a, man today is not how much in
crease there will be in his premium in
come, but as to the cost of his bust
ness and the amount of premiums out
standing