The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1905-07-02
$35,5OS.241 $1,O35,151 s5,733,O COS

$35,508,241 $1,035,151 $5,733,OO6
"Out of the total income of stock
companies, $35,508,241, it is seen that
Southern stock companies did a busl-
ness of only $2,949,935, or ga per cent
of the whole, leaving 91.6 per cent OF
$32, 55S,306, to be transacted by non
resident companies. This does rot in
clude the business done by local
Southern mutual companies OF apoul
81 100000, as shown in the table OF
the much larger business done by the
large nonresident Northern senior ana
junior mill mutual companies.
1T may be claimed that While ad-
hitting most of this 'large sum OF
$32,55S, 306 is primarily shipped away
the bulk of it eventually comes PACK
to the South in the way of losses, the
companies retaining only reasona Die
percentage as their underwriting
profit for their risk and trouble. rms
is true, and it is not true. These
premiums are cash in advance to cover
periods running frequently as long as
five years, and the laws OF practically
every State declare that only pro
rata of such premiums are earned Iol
the actual time elapsed, so companies
are compelled to charge themselves
with the unearned premiums as liza
bility which the law says really be-
longs to the policy-holder as re-
insurance reserve. Such reserves
amount practically to about 10 per
cent OF premiums annually reported
so out of the $32,558,306 received by
them the nonresident companies owe
the Southern people 4,42S,13O, or, IN
round figures, $26 100000, which large
sum these companies have the use OF
free of all interest charges.
~ dc n
land have shown in the past that they
are pretty quick to catch onto good
things, and the record proves that they
have not overlooked fire insurance as
medium OF inducing the South to
ship them up a good many of their
millions for their use and profit.
"Thc city of Hartford, Conn, alone,
with a population less than the city OF
Atlanta has six fire insurance COM
panies viz, the Aetna, Connecticut,
Hartford, National, Orient and Pnoe-
nix. These companies were smart
enough last year to secure about one
sixth of the entire fire insurance bust
ness in the South ($5,733, 008), or just
double that of all Southern companies
combined f$2,949,935). But that is
not the worst OF it. The unearned re-
serve on this Southern business done
by the Hartford companies amounts
to fully $4,0OO,0OO, which amount they
have the free use of straight along
without interest
rs 1t any wonder their banks ard
trust companies are chuck-a- block
with ready money? OF course, they
can we'll afford to run companies up
there if they can barely get in enough
premiums from the South and else
where to pay expenses and losses, just
so long as they can get the use On
terest free) of these large unearned
reserve funds.
Leaving all sectional prejudice
aside, the question that naturally sug-
geSts itself to me is: Are we not
now strong, honest and capable
enough to take care OF the bulk OF our
own fire insurance business in the
South and retain al. home the millions
of money we are now shipping away
for unearned premiums, and place the
same in our own banks and trust COM
panies for the use. and development
of our own section? l am positively
certain We are