New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-14
Profits from War Risks

Results of operation Of the large
private British marine insurance com
panies for the first full year OF the
war. 1915. ale now available. They are
interesting, for they afford some idea
of the amount of war risk business
being written. The London Times OF
recent date devotes considerable space
TO a discussion of marine insurance
and the war, in which it says:
There arc certain distinct differ
cnces between the present figures and
those which were issued in peace time.
First. war risks, which are usually
written for each voyage or for quite
short periods, are disposed of much
more quickly than marine risks. An
underwater, therefore, who accepts a
large amount of war business should
shortly after the conclusion of the first
year be in better position to form
a shrewd idea of what the results of
this business should in the main be.
Consequently, 20 this extent the first
year settlements are real indication
of the final settlements, and by the
end of the second year the complete
results of war risk underwriting
should be known.
"On the other hand, there is at pres
ent a contrary factor at work affecting
marine risks in contradistinction to war
risks. Owing to the absolutely UMPIRE
cedented conditions, ships have been
kept at work during the war as long as
it was at all practicable for them to be
at sea. This means that repairs have
been deferred much past the usual time.
and this will help to swell the third
year settlements. Further, the cost of
repairs has, Of course, enormously in
creased. These two considerations to-
gether would naturally tend to make
the third year settlements in respect of
pure marine insurance much above the
normal. 1t would, therefore, be quite
impossible without close examination
into the circumstances Of each COM
pany's business TO predict il the
amounts put by TO suspense will. or
will not, be available in the present alb
normal circumstances to meet all the
demands which will be made upon
them.
Subject TO these considerations, the
figures in the following table are a
guide to the actual profits on the un-
derwriting accounts for 1915. They
show, for seven companies whose ac-
counts permit OF analysis on the same
simple lines, the net premiums, the &C
tual earnings, after allowing for all
claim settlements and expenses, and
the sums put to suspense to close the
accounts, and the percentage of the
profit to the net premiums. These COM
panes may be regarded as representa-
tive of the whole market. The pre-
miums were largely increased, and the
actual profit and the percentage must
be reckoned as distinctly satisfactory.
In every case the actual profit is in
creased, while in some instances the
percentage is also higher. Thus the
British and foreign earned an actual
underwriting profit Of s995,7l5, or 25.4
per cent, as against s533,s55, or 2l.5
per cent for 1915. The indemnity's
profit of $780,, $50, or l5.4 per cent, COM
pares with s523,4OO, or l6.9 per cent.
"The Merchants figures of 1926. 265,
or 20 per cent. compare with s263.335,
or also 20 per cent. The Reliance earned
sli6,l05, or l69 per cent, as against
sl25.600. or 1873 per cent The Seas
profit Of si35.i05. or Ii per cent, COM
pares with 10000, or 17.2 per cent.
The Union recorded improved figures.
with a profit of 1851. 30, or 1873 per
cent rs against s52i.47o. or 1i2 per