Hattiesburg daily progress. (Hattiesburg, Miss.) 18??-1909, 1902-09-27
FIRE INSURANCE.

To the Editor ofthe Progress.
The subject of fire insurance is one !
that has absorbed much Of public |
thought and public discussion in this
state for the past eight or ten years.
The rapid Industrial and commercial
growth of the state in the last two
decades has brought the subject into
great prominence, and the result has
been that our insurance laws have
been tinkered with and patched by |
legislators who have not understood |
the subject and who have proceeded |
upon the fallaciOus idea that insur- |
ance companies are public corpora
tions, and therefore subject to legisla-
ton, supervision and control.
The legislature can prescribe the
terms upon which foreign corpora
tions may do business in this state,
but beyond this 1t cannot go. 1t is
left to the will of the company
whether it will do business or not on
the terms and conditions prescribed
by the legislative Will. The great
fundamental principle that lays at
the bottom of all business, to-wlt:
Competition, has been ignored by our.
lawmakers in the vain effort to con-
troll by legislative enactment the
business of insurance.
The valued policy law, of woich
Judge Critz was the author, has
proven to be yeritable Pandora's
box to the business interest of the
state under It's operation. The first
year Of its existence in the state the
fire losses exceeded by far those of
any year in the previous history of
the state. The result was the insu-
rance companies got together and
formed tariff association and ad-
vanced the rates in selfdefense.
AThe valued policy law is a vicious
one. 1t is wrong in principle and Of
ten wicked in practice. The true
| theory of insurance is indemnity
against loss by fire. The theory of
the valued policy law is, the compa-
ny must pay the amount stipulated
IN the policy whether the insured has
lost that amount or not. The theory
of insursance is that, when a loss oc
ours it must be fairly adjusted-that
is the amount of the loss ascertain
ed after it occurs and the amount
paid; the theory of the valued policy
law is that the loss must be adjusted
before or at the time insurance is writ
ten, and it goes without saying this
cannot be fairly done, or if fairly done
it costs too much. To illustrate, an
agent in Hattiesburg has an applica-
ton to insure a residence ten miles
in the country. He must go out and
examine the property to ascertain
what it is worth, and when he in
spects it he has only crude opinion
and worth nothing when 1t comes to
the real value of the property. I'm
der the true theory the estimate of
the applicant is taken as correct, for
the man who owns the property
knows what it is worth. If he does
not know it is his misfortune, for
when an accidental fire occurs and
, destroys it, an adjuster is sent to adj
+ lust the loss. He calls an expert tC
his aid, an architect or builder and
. he figures the loss to a cent.
The ''Cole law" VIII prove stu
pendous failure. There is too mucl
n machinery; too many contingencies
}, 1t shuts out rather than encourages
i competition. Competition is wha
we want. To get this, restore the OLE
deposit law, or rather the prInclpl
. of that law, and we VIII have cheap
:, er insurance and better insurance
d1 Every observant man in the stat
. knows that under the old deposit laS
imperfect in many respects that !
was we had the best and cheapes
insurance in the history of the state