The daily appeal. [volume] (Carson City, Nev.) 1906-1907, 1906-05-09
THE INSURANCE QUESTION
An Interview With State Commission
er Davis

ance authorizes the following state
ment regarding matter which is
uppermost in the minds Of many bust
ness men in the community.
The refusal of the State to rein
sure it's property for over sixty days
was because of the risk it might run
in doing business with Companies
which might be seriously crippled by
the San Francisco disaster. II will
be impossible to tell for some weeks
yet what companies have been the
hardest hit. 1t would be a mirical
if some did not 60 to the wall. l
believe the losses will pass the two
hundred million mark. and some au-
thorities give higher estimate. This
exceeds the surplus Of all the com.
panies in California at the time of
the fire.
Some of the companis had their
Offices so completely destroyed that
tuey uu uOl save Their UOohS anu
have already received word from
companies in San Francisco to send
them certified copies Of their annual
statements filed with this Office at the
beginning of the year.
This will give you some idea OF
the completeness of their losses in the
various Offices.
The loss will not fall entirely upon
the California Companies but it does
not seen uniformly distributed.
Out side estimates largely exceed
the losses gwen on, by the companies
themselves Here are some OF the
conditions adverse to the Insurance
Companies.
The practice of under-inSurance in
proportion to value in California; the
absence of co-insurance and similar
provisions; the great loss in the res
dence or preferred districts; the large
shrinkage in securities. not only of
California securities. but all classes
of securities held by the Companies;
the high rates OF interest for money,
and the possible further arrangement
of the markets; the difficulty, even
in case of w:lling stockholders, of
paying up the assessments or con-
tributiOns which must be made to
enable many of he Companies to
continue in bus ness; the minimum
effect upon values caused by the earth
quake: the fact that the extent of the
earthquake losses can be readily as
certained because the fire spread but
slowly, and that the courts will be
quite likely to construe the earth
quake or falling wall clauses literally
as to the assured; the fact that the
California statutes are favorable to
the assured in several respects. in
Guiding the question of loss OccasiOneC
by the use of dynamite or Other
methods of limiting OF cOnflagratiol
area; and the possibility that the
statements required by the Insurance
Commissioners of the different State:
will reveal conditions more unfavOr
able than have been anticipated ant
will drag in Companies whose losse
through reinsurance have not other
oil Of no
things and more must be given du
weight.
and by the community are create
than in any single calamity in tn
no precedent exists for estimatin
their effect One thing IS perfectl
clear. Every buyer OF insurance ough
to give attention to his insurance an
his hazard and to obtain outs ale an
independent reports upon Companie
in which he is carrying insurance
The great majority of insurance a:
for learning the condition of Insuranc
Companies
The cumulative effect of these Gil
asters and the possibility OF di
asters elsewhere succeeding then
have to be reckOned with.
The proposed plan of the Fl!
Insurance Companies to recOupera
the losses by any general raise
rates is wholly unwarranted. Only
min Gritty of the Companies doing bus
ness N the United States experience
excessive losses at San Francisco.
| only have Official knowledge
one Company going to the wall 81
that is the. Traders Fire lnsuran'