The labor world. [volume] (Duluth, Minn.) 1896-current, 1911-05-27
REMEDY IS AFFORDED
BY STAT INSURANCE
Miles w. Dawson, America Is Lead
ing Insurance Actuary, Takes
Most Firm Position.
Rebulkes Employer s Liability
Companies and Champions
= Industrial Insurance. >.

dents Of the subject in Minnesota of
late. .---s.4sI az - .,,r
The Labor World proposes from
time to time to disucss the question
Of, employers liability and working
mems compensation. In this issue
we present an able and timely article
from Miles NJ. Dawson, author of
of "Workingmen' Insurance In Eur
ope,' and generally accredited to be
Americas leading actuary on indus
trial insurance. This article appeared
in a recent issue Of, the Survey,
publication devoted to social issues.
+. States Must Take Action. y
Mr.. Dawson holds that the New
York court of appeals has rendered
it necessary for the several states
to go further and differently into
the question Of yworkingmen's COM
pensation If the entire plan of a more
just and practical system is not to
be Abandoned. ##z& .,.,~~s g..
Referring to the dreadful fire in
New York in which tne lives of LAB
factory workers were sacrificed, he
said: "g.G .-e = :
This affords not only lesson as
to the necessity for doing something,
but perhaps as to what should be
done. If 1t were to remove the de-
fences against claims for employers
liability the employer, TN case like
this, would usually be unable to re-
spond, and bankruptcy. with the de-
struction of business as we'll as fall
ure to indemnify the families of the
deceased, would result.
Evils of Individual Liability
It would not be different, likewise,
were there individual liability: of en-
plOyers under a work1nen's compep-
sation act; business failure and little
or no indemnity would still result
This may be avoided partly if the
employer voluntarily linsures; but even
so, the usual form of policy limits
the aggregate indemnity to, say, $780,
900, which would be altogether in
adequate. - /
Only under compulsory insurance,
to which the state would at least
lend it's compulsion, whether managed
by the state as in Norway, or by
mutual associations of employers as
in Germany, or permitted in a state
institution, q mutual association or a
stock company as: In Italy, does it
appear that such a condition could
certainly be dealt with, even as mat
ter Of indemnity AS a matter Of
prevention it certainty could not be
adequately provided against except
under a. system or compulsory state
insurance or compulsory insurance
in employers mutual associations.
Germany Has Best System.
The most thorough-going and eff
fAHf110l ~ Sa1v
been adopted in Germany, where
compulsory insurance in employers
mutual associations is in force. It
seems clear, also, that such may fair
~ be expected to- result because In
such case, and In sucn case only,
will employers individually welcome
factory inspection. This they then do
on the basis that it is rewarded by
a reduction in the cost.
Precisely this experience, likewise,
has already been mad in the United
States in the factory mutual fire in
surance associations which have re-
duced rates to a merely nomial, figure,
frequently as low as one-tenth of one
per cent per annum on hazards which
under the system Of volutary insur-
ance in stock companies that pre-
viously obtained, cost. from two per
cent to five per cent per annum-i,
e., from twenty to fifty times as
much. =, ".
Virtues of Mutual Fire insurance.
There may then even be good rea-
son also for compulsion to require
the extension Of this system Of mu-
tual fire insurance to all factories and
workshops >s.,
Under compulsory insurance against
Industrial accidents, there is also this
advantage; all systems of making the
employers individually liable create a
marked tendency to have benefits
paid in lump sums, or the term Of
payment limited, and to keep the
amount low. This is due to tinidity,
to unwillingness Of private insurance
companies to provide permanent
benefits during disability or widow
hood, and the like, It has been most
marked In the legislation and the pro-
posed legislation; In this country, in
that respect the poorest excuse for
something adequate offered or
adopted in any nation. An exception
Is the complete and elaborte state
Insurance law just provides for per-
manent payment of benefits Under
other laws benefits thus throwing
the permanently disabled, widows
|-and fatherless, upon public or pri-
vate cnarity after g few years.
Make Shift Laws Unnecessary.
Under any system Of compulsory
Insurance. whether managed BY the
state or by mutual associations OF
employers. there 10 little or. no de-
mand for such makeshifts l5 KID .s
Obviously, likewise, Insurance Of
that type can be conducted, and -
conducted. at enormously lower man
agement expense The average ex-
pense Of compulsory insurance man
agement in Norway. Austria, and Ger
many Is about IL per cent OF the net
cost, whereas the expense Of the most
successful system sof voluntary stock
COM any Insurance, tnat of Great
Britain, Is approximately 100 per cent
Of the net cost. The expense Tor
agents comnissio IONS alone Is there
nearly 80 per cent Of the net cost.
Private Insurance u Curse.
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