The evening times. [volume] (Washington, D.C.) 1895-1902, 1900-05-07

NEW YORK. May THE fire insurance
companies of the United States. judging
from the cries of distress heard now and
then. are passing through an ordeal OF
losses well calculated to test their soivency.
Many underwrite IS do not hesitate to say
that rates will have to be largely increased
IL the weaker companies stay in the field.
The FIRE n Ottawa and Hull, although
across the border and involving British
companies TO a large extent, has added to
the disquiet of the underwriters of this
country. who get little comfort from the
outlook
Elijah R. Kennedy. one of the prominent
Gre insurance men OF the metropolis. was
seen yesterday with reference to the pres
emit situation.
Il suppose" said Mr. Kennedy, that
The fire losses of the last four months are
heavier in relation TO the FIRE premiums for
the same period than they have ever been
before in the entire history Of fire under
writing in the United States. Following
upon the excessively disastrous results of
1899. this continuance of losses is fairly
appalling. IL Is a wonderful evidence of
the solveney OF the companies that SO few
of them have failed, and il is an equally
Impressive testimony TO their fortitude and
stability that few of them have been
driven TO retire This condition. however,
cannot last much longer. Even the compa-
MES that have money so that they could
survive. don't keep their motley TO lose in
This way
ITO what is the excessive and abnormal
loss of this period due? Mr.. Kennedy was
asked
II believe it is thoroughly agreed upon
by underwriters that il is due to the phe-
nomenal and perhaps unprecedented pros
perity of the country. In ordinary times
what is called the moral hazard is the
cause of numerous losses. a man is I'M
prosperous, sees failure ahead, and raises
money by selling out to the insurance
companies. You would at first thought ex-
pect that when all the rest Of the coun-
try was prosperous the fire insurance COM
panies would thrive through the diminu-
ton II not the elimination of this element
of moral hazard. and il is indubitable that
the losses among poor risks, where in or
binary times a moral hazard would need
to be thoroughly investigated. have been
much less in the last eighteen months
than we are accustomed TO. But mean
time the great prosperous properties have
been burning. On a risk under distTust
a few companies might write $1,000 OF
$500 apiece and when IL burns il hurts
no one of them very much; but on a mag
nificent warehouse. prosperous to the
highest degree or a great factory. where
the conditions absolutely exclude the pos
sibilitS of moral hazard why the same
companies have perhaps $4,000 or SIS 600
apiece, and the losses by the destruction
OF a number OF these make an enormous
aggregate"
Prosperity and Losses.
But now is the prosperity OF the coun-
try causing these Iosses?'' enquired the re-
porter.
why, through the overtaxing Of the es-
tablishmeEts Take the instance of a ho-
siery mill in Pennsylvania on which the
companies had very ISrge lines indeed.
This property was working not only all
day. but also all night and so much in
demand were its products that the entire
output Of the mill for the next eight
months had been sold. But the mill burn
ed TO the ground. Ordinarily the heat gen
Grated by the friction in the machinery
ceases shortly after work shuts down az
sunset but where the friction is kept up
all night Icing the danger point is fire.
quently passed in that excess Of the usual
working hours. Again. much cotton and
wool are flying about in such places. and
they get into the oil and the Journals thus
Gus combustion IL the mill is stopped ev
cry day and carefully looked after. and
then Is occasionally shut down a day or
two at time for repairs and cleaning up.
these dangers are all guarded against: but
when the mill is going all the time clean
illness is not possible disorder ensues,
rubbish accumulates and the moment YOU
have dirty risk you have a dangerous
one. Then. as to the boilers, If the fires
must be kept up continuously night and
day defects are created. but are not dis
covered in that careless examination which
Is usually made only while the fires are
drawn. At such times, too. the operatives
working long over their usual time be-
come tired and negligent. and the men
whose especial duty it is t. clean I'D aft
or ordinary working hours are glad enough
to get home for a little sleep without any
great effort in the Discharge OF their du-
ties.
Electricity the Greatest Cause
But I must say that it is generally he
lieved that electricity is the most potent
single cause of fires in these great risks
which have been burning In the last
twenty years electricity has probably cost
the country more than $3.50 goo 900 in FIRE
losses. and yet, so far as ! know. the fire
insurance companies have never charged
an extra rate for risk equipped with this
incendlary. In such a time as this. when
the capacity for electric lighting is taxed
TO the utmost. and when the time for re-
pairs is diminished through the constant
use Of the wires and lights, the defects
which rapidly grow, even TO an installment
originally put in according to rules, the
dangers from the use of electricity are
much create in seasons when the
electric wi-C lights of place are in
use only comparatively small portion OF
the time"
Are the companies doing anything
about this?"
We'll. that is difficult to say. Rates
--------