The silver star., 1901-01-25
FIRE INSURANCE in Cola

o"paniss An
Five Aa''''oas Annually o., :.
stats-His Dsductlops rbo,.-
leading.
The message Of Governo, =
to the Legislature, while an M.
ment in many respects ID cc,.. ny
in the fact that his figures !, :.
Insurance in Colorado are No.
information 10 erroneous q. ~
ally ridiculous.
We quote from the Governov.
sage:
INSURANCE ASSESSMENT
The insurance companies do.s
ness =, u / state are by lav \.
to pay into the treasury two -
In excess Of the premiums amman
ceived over losses and ordln,,
penses incurred within thu sts,.
estimated income from this SOM.
the present biennial period ia rx
or $97. 500 per annum. The actn.,
ceipts for the last two years e,,.
$215,000. This means that the ~
OF the insurance companies from !,
holders are annually over s5Ooo n
excess OF losses and expense,
great bulk OF which is taken elsevI
The percentage paid to the stat.
this enormous income, which ia h,
profit, is insignificant. am nm
informed that the average specIs,
surance tax throughout the unIo
over three per cent. An increar
one per cent on insurance recelpr
give an additional 100000 to the
for the next two years, and the N
burden to the companies will be a.,
ly perceptible."
In another part Of the messas,
Governor writes:
Il have referred to the states d
nous insurance business. Over E
600 in excess OF losses and expe
are paid annually to these comp,,
by far the greater part OF which
foreign. This tribute constitute
tremendous drain upon our people
The estimated premiums on I'm
surance paid by the citizens Of DeaI
from April, 1900. to December, lN(
100000; losses by flre. sSso.sa
balance. $339, ,37O.55."
Where the Governor got his Cd
or his ideas as to the law is unkud
and his deductions make a very uu
and unfair statement when he attes
to figure from the amount OF d
paid the apparent profit, as be
eliminates the, item Of expenses.
The facts are that for 1899. the [
year OF official reports at hand,
total premiums paid for fire insurl
for all companies combined, in d
RADIO. were S1.705. 1896. Losses paid 4
$1.072.669 or 81 $40 per cent.
penses average 40 per cent. or Sss,l
showing losses and expenses to Be |
754,7S7, or a net loss TO the bust
in Colorado OF $40. .492 during that
The law taxing profits has been chl
ed and now the companies pay q !
cent tax on gross premiums. whieA
cludes taxing losses and expense
is safe to say that expenses ave-
per cent higher In the mountain 4
than In the more compactly built :
ern territory. owing to long dis's
and high railroad and hotel fareA
We md that for twenty yean
average loss ratio In Colorado hasl
ceeded forty-seven per cent. Fgu,
expenses at forty-three per cent Il
an apparent profit of only ten per 4
which is not high. considering
hazardous nature Of the business
constant liability to conhagrations
those that visited and destroyed q
pie Creek twice and Victor.
The Governor. as quoted abo,s
evidently at sea as to profits whs
says the estimated premiums on
insurance paid by the citizens Of
yer from April. 1900. to Deceu'
1900. are 100000: losses by fire.
629.45: balance. s33s.370.55. omii'
entirely any allusion to expenses
1901. 900. most Of which is spent ii|
state for taxes. commissions. "
ing and loss adjusting expenses.
II 10 a solemn fact that through q
petition. adverse legislation. and ID
and expenses the business OF fire -
ance has not yielded one-half Of
per cent net profit In the United ~
for all surviving companies Tor
cycle Of 20 years. and that there =
retired or failed over three huns
stock companies-the number OF
tual companies that have failed =
beyond computation.
It II also fact that fre insufs
companies do not pay any losses O
penses. They are simply cies1
houses for the collection and disa'
tion Of the iire insurance tar. y
put up capital for carrying on the :
ness. The policy holder must py
entire bill, and NO matter DO.
psrehtly burdensome the legisls1'.
made against the corporations shs
mium payer pays the entire :
Every Item Of cost 10 added to ne .
The public. when enlightened
such facts % thess. will undoaus
~ Il TO their advantage TO let ~
Of supply and demand regu'au
cost. Competition will. ~ it =
ways. hold the cost down 70
Unlalunss~