The sun., 1919-02-24
BRITISH DEFEND new
U. s. SHIP INSURANCE
Deny High Rates Are Designed
to Cripple Trade in Amer
lean Bottoms.
WOODEN VESSELS ARE HIT
New Yorker Quoted to Bolster
Underwriters Contention
Of Heavy Losses.
WOODEN VESSELS ARE HIT
Special cooie Despatch to THE SEX from "A,
london Times Service

london Times Service
Copyright. 1919: all rights ,eserred.
LONDON, Feb. 23-Regardlng cabl.a
statements OF the bill in the Senate for
Government insurance on American shios
on account OF the alleged extortlona,
British insurance charges, a shipping
expert says:
British underwriters will certainly h,
found to subscribe to the view that their
quotations are 'exorbitant and the SUE.
gestion which has been made that tina
high rates are quoted In order to injur.
the trade OF the United States is clearly
due to a complete misunderstan ding"
As matter Of fact the view ha,
been expressed In American underwriting
circles that the rates Of insurance hay,
been unduly low. The question OF high
rates arises only in apparent respect to
wooden steamships. auxiliary power yes.
sells and unbiased ships
The splendid motives which during IN,
war prompted the United States to build
wooden and auxiliary power vessels on
large scale are we'll appreciated In IN.
British insurance markets, but II has TO
be shown yet that such vessels. for In.
surance purposes, can be placed IN the
same category as steel steamships are
classed, with a registry admitted Rate.
on wooden and auxiliary vessels and un.
classed steel steamships are high a.
compared with quotations on classed
steel steamships, but the experience Of
underwriters Is already such that they
feel strongly that in going slowly with
insurance on wooden vessels they ar.
no more deserving OF reproach than are
the American underwriters.
On the general subject Of insurance
rates extracts from an article which ap-
pears in the Eastern TndertCriter. pub
lished weekly in New York and generally
regarded as authoritative, may 10
quoted In the course of this article pub
lished In the issue OF January 81.
AN observer" writes THE under.
writer's 1918 account of American
marine Insurance companies will show
in nearly every case absolutely no profit
whatever and In some cases very
heavy percentage of loss. There have
appeared in our various issues comments
along these lines showing numerous
heavy losses sustained this year early,
both in marine and war business. at an
especially good season of the year with
absolutely no letup In the closing months
since our last comments. Rates charged
on marine insurance have been entirely
too low"
After reviewing the experience OF IN.
year in some detail the observer" con-
tinues:
Unless steps are taken In the future
10 raise materially ocean marine rates,
and with the risk on theft and pilferag.
eliminated. there will be absolutely no
possibility OF any profit In this class q
business. Hull risk rates will have 10
be raised to take care OF the increased
cost of labor and material and moral
hazard as far as valuations are con-
cerned will bear scrutiny.
Furthermore" the article concludes
''it Is absolutely essential that companie4
engaged in this class of business get TO-
gether and formulate associations FOR
the improvement of indications and rates
in order to put the business on a paying
basis Unless some movement Is started
in this direction and steps are taEea
very carefully to underwrlte and d,7-
criminate against business which has
proved Improbable In the past. the ma
rine insurance business for 1919 WN
again prove Improbable and large
market which has been developed in ne
United States viii suddenly disappear
as no company will continue to re in q
losing game"
The views so forcibly expressed in mi.
article are reflected in the London !->,r.
ance market, where the expericnc. Z:
English underwriters In respect o. sola'
classes OF business has been quite as gn-
favorable as that OF American u.lr.-
writer's. The article. which presur sAi
was written by an expert, gives dl5."r'
ent impression from that conveyed IN
kilograms.