Windham County reformer. (Brattleboro, Vt.) 1901-1906, 1902-03-14
BRATTLEBoRo,v VT. FRIDAY, MAR. IA, 1902
As to Insurance Rates.

Insurance companies have been los
ing money in Vermont while steadily
making it over in New Hampshire un
der the valued policy lawn most of
recent years-~and they have made that
the excuse for a rapid boosting" of
rates. But last year there was a de
cided change for the better, the prem
iums received, according to the com
missioner's report, just issued, being
S914, 401 and the losses incurred S44S,
O99. Allowing the outside tigure,33 per
cent, for the expenses of doing the bus
mess, there would still be left as net
profit for the companies Sl6l, 502 from
the years business, or bit over lT12
per cent. But don't expect any such
promptness in reducing rates as there
has been here in raising them, Bust
ness organized on the trust principle
as insurance is, does not operate that
way, 1t will want to be assured--a
good deal more than it did in the time
of losses--that the condition disclosed
by the figures is permanent one.
Then it will proceed to meet it by
raising eypenses-unless in the mean
time it be met by the competitive
principle.
The above observations were in type
for last week, but crowded out by
pressure of news. And simultaneously
comes confirmation of them in the an
nouncement that the New England In
surance Exchange followed by all the
companies in the country, has ad
vanced rates % per cent. on all mer-
camille and manufacturing and other
risks of special hazard, except build
ings under hydrant projections
The Boston Record we'll states the
law of the thing when it says of the
companies. "They ought, of course, to
accumulate a handsome surplus when
there are few fires. They do, of course.
But when losses come together in con-
siderable number, they raise cry and /
mark up the figures!' This has been /
the exact history of the past 10 years.
Under the pressure of the hard times /
losses multiplied and rates went up. |
Then there was time of relief. and |
decreasing losses: but rates maintained |
their new level, which is now raised .
again as quick as losses increase.
Back of it all, the real crux of the
insurance prob@m, is that the system
is one that promotes over-insurance and
multiplies incendiarism. While insur-
ance men recognize the fact, they feel
helpless under it and have thus far
found no way of resistance except in
the way of more inspection, at heavy /
increase of expense accounts already
and by the outlawing
of certain classes of risks. The folly
of it all took expression a few years
ago in the reinsurance clause, (which
instead of the beneficent principle of
genuine reinsurance, only operates
towards forcing over insurance the
bottom trouble of abby crowding to
the danger line. In other words, this
trust organization of the business is
only piling up loss and disaster, by
at the wrong end of the sub
ject, and looking only to the increase
Of receipts, while the true place of eff ,
fort is in the decreasing of losses. ,
Matters have now reached a point
where fire losses in the United States :
are proportionally several times those
of any other land in the civilized world
except Russia, and present methods can
continue growing and multiplying on {
he merit it feeds upon until insurance
rates pass the 100 per cent. mark.
There is nothing in American affairs :
hat so needs radical reform and reor- 1
.anization as insurance. And exper- ]
ence has demonstrated that the trust |
way is just not the way to do it.