The National leader., 1922-01-09

5 Ill OpcIdllO1l Is OdVlIlg
apartment Just Out
S. A. Olsness farmer commissioner of insurance
in North Dakota, has just been made. It covers
the operations of the Nonpartisan league state hail
insurance plan since it's establishment by the farm
ers' legislature. It covers the facts up until May
81 1921, and is the latest report available. 1t
ports the working out of state hail Insurance. under
the League plan, for the crop years Of 1919 and
1920 Let what it says:
In 1919 the state insured H. $3.50 of land
and assumed risk it of $86, 1853 457, collecting,
in premiums to pay losses, $3,959, ,64794.
In 1920 the state insured IL O53, ZAP of land
and assumed risk of $84,376 196, collecting, in
premiums to pay losses $3,84S,845.39.
FARMERS ARE SAVING MILLIONS
OF DOLLARS A YEAR UNDER PLAN
Thus the North Dakota hail insurance, under the
League plan of the biggest state enterprises
in the country. Compare the figures with the old,
make-shft insurance with which the politicians
thought they could satisfy the farmers That make
shift plan insured the only 100000 acres
year, against over 100000 acres under the
League plan. 1t assumed risks in it's largest year
of much less than $1,000,0O0, against 84,O0O
900 under the League plan. It collected in pre1ni-
in it's most prosperous year only $65,0O0,
against nearly $4,OOO,OO0 year collected under
the League plan. It NEVER paid losses in full.
The League plan pays ALL losses in full.
But have the farmers saved anything by the
League state insurance.? Well, read the figures:
The rate of premium charged for state insurance
in the last crop year reported by Insurance Com
missioner Olsness, 1920, was Az per cent. For
that year in North Dakota old line private hail in
surance companies charged average of 10 per
cent.
Nineteen private hail insurance companies, still
doing business in North Dakota, in 1920 collected
premiums from the farmers amounting to $780,
424.7O. They paid losses out of these premiums
amounting to only $1,22a, ,5214s Thus this
small amount of business they kept 100000
of what they collected. This money held out was
largely profits and commissions.
In the same year the North Dakota state hail
insurance collected $3,848,S45 in premiums, and
paid losses of 98466, holding out less from
the premiums, on twice the business, than the pri-
vate companies.
1t will be seen from these figures that state hail
insurance paid back to the farmers $3.50 per cent
of what it collected in premiums At the same time
private hail insurance companies for the same year
paid back to farmers only 61.83 per cent Of pre-
miums collected.
Why did the companies retain so much of what
they collected, and why did the state retain so lit
tie? Because the state did not have to pay big
commissions to insurance writer's, and big profits
to private individuals who own the private COM
panies. In other words, the state insurance
operated for COST.
But consider this: The private companies in
1920, above reported, did BETTER by the farmers
that year than they used to do BEFORE the League
hail plan adopted by the state. Competition
by the state has FORCED them to do better.
Formerly they retained much higher percentage
Of the premiums they collected and paid a less
proportion back in losses, than is the case.
The state does four-ffths Of the hail nsur-
ance business in North Dakota. What is the money
saving to the farmers? The saving is the differ
ence between premium rate of Az per cent and
premium rate averaging 10 per cent. The former
is the state rate, the latter is the old line company