San Antonio daily light. [volume] (San Antonio, Tex.) 1886-1907, 1894-05-18
Communicated.
CO-INSURANCE POLICY.
NEW SCHEME THAT INSURANCE
COMPANIES ARE BROAOHING,
The Citizens Required to Pay Full
Rates and, in Many Cases, Can
Only Recover Half the Amount
of Their Policy Value.

before the people of San Antonio,
and indeed of all the state, that is
the proposal of the insurance men
to introduce the co-insurance clause
in all fire insurance policies. That
means that in future all the in
sured shall pay full premium on
the amount insured and then, in
the case of partial loss by fire, shall
bear one-half the loss. To explain
this fully it may be briefly said
that should a man insured take out
a $1,000 fire insurance policy he
would pay the full rate, but should
he have a fire that entailed a bona
fide and partial loss of that $1,000
he would only get $4,000, even
though he had been insured for
years without loss and had paid the
loss by the way of premiums. If,
however, there was total loss he
would get full amount.
Naturally the public think this
is an injustice and kick at the pro-
posed innovation. The insurance
men demand it and justify the
demand by the statement that
the losses have been very great
in Texas. They also claim that
this new clause will have a ten
dency to stop incendiarism, which,
it is alleged, has prevailed.
Let us for few moments analyse
these statements and see how far
they are correct.
So far as | can understands
may be wrong and shall be glad of
a correction if that is so-this
clause is specially for the benefit
of the Southern states, in which it
is claimed that great losses have
occurred, and, of course, Texas is
included. Is this so
The rates charged by insurance
men in Texas are high, very, very
high. This is caused by the heavy
expenses, big buildings, great sala-
ries and big commissions to agents.
The losses proportionately are not
much more than in the Northern
cities, especially so far as San An
tonic is concerned.
Now what does the Texas COM
missioner OF insurance and statis-
tics say in respect to this matter.
Read, for l quote what he says:
"Texas showed up better than
many other states. The loss for
1898 was less than for 1892, and for
1892 it was less than for 1891. In
1898 the loss was about &C or g.
haven't the exact figures at hand.
The total premiums in 1898 were
$3,543,175, and the losses paid,
$2,S33,17S."
This shows that last year the in
surance companies received $780,
99S more than they paid for fire
damages, which is a good profit.
This report, too, shows that the
profits are gradually increasing.
What is the reason for this? 1t is
better fire department service, such
as the fire alarm system, also
better apparatus and more eX-
perienced men, paid for by the peo-
pie, and for continuous improve
ment. Yet, in the face of the in
creasing profits and better protec-
ton for the public and fire insur-
ance companies, the latter propose
to tax the people further by the
co-insurance policy. This, to my
mind, is illogical and selfish.
The commissioner also says that
of 100 per cent losses, IS per cent is
the actual loss, the remaining
80 per cent being due to
expense. If insurance is so unpro-
| fitable to the companies why don't
they, like other wise business men,
reduced expenses?
Remember the figures given by
the commissioner are based on the
returns of the fire insurance COM
panies who are sure to give
maximum of loss and minimum of
gains to justify the high rates.
The absurdities Of the idea of
the new clause that it will stay
incendiarism, is apparent. We have
a law that imposes a severe pun
ishment for the crime, and / would
like to see every one punished who
is guilty of such fiendishness, for
when fire is started none know
where it will end, what lives may
be sacrificed and what ruin created.
If this law will not stay incendiar-
ism what will? certainly not the CO.
insurance clause that, as l will
show, gives a premium to incendi-
airy and reckless loss.
Under the old system if a bona
fide fire occurred a man sought to
save all he could and was satisfied
on being paid the actual loss;
moreover he could only get that
amount of insurance the agent
chose to allow, always considera-