The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1923-10-30
STATE HAIL
FUTURE NOW
is DISCUSSED
Decrease in Acreage in Last
Two Years Presents a
Problem for Officials
is AGAINST LIMIT
Commission of Insurance Ols-
ness Declares Maximum
Tax Provision Wrong
is AGAINST T. LIMIT

The future of the State Hail In
surance Department., which this year
sustained greater losses than it can
pay in full under the maximum in
surance tax permitted by the legis-
lature, is being discussed among
state officials and others. Whether
the decrease of more than 30 percent
in the acreage insured in the last
two years will be followed by an ad
ditional decrease in the insured
acreage next year, with consequent
insufficiency in the maximum rate
should losses be heavy, is matter
of serious concern not only to Off
cials of the State Hail Insurance de-
partment bus to other officials in
terested in the subject.
The statement of Governor Nestos,
in declining to call a special session
of the legislature to change law
which that body enacted and sugges-
tion that if, the law is to be changed
it can be expeditiously changed by
use of the initiative in the March,
1924, primary election, finds accord
in the state department. Martin Ha-
gen, manager of the department, said
today that the department is not in
favor Of an extra session of the leg
islature. It is possible, he said, that
if the matter of insufficiency Of the
maximum tax is brought before the
people by the initiative, two or three
other amendments may be proposed.
There is lack of agreement among
officials as to the cause for the
heavy decrease in the insured acre
age. Commissioner of Insurance S.
A. Olsness ascribes it solely to de-
preston in the farming business.
Cause Of Decrease
One difference between the state
hail insurance law workings and that
of old line hail companies, according
to one representative Of the latter,
is that the state department insures
anybody while the old lire companies
limit insurance, some insuring but
one quarter out of q section of land.
This method is used by old line
companies to diversity the risk and
avoid danger of unusually heavy
losses from a storm which would
completely wipe out one area.
Many farmers, it is said by some
officials, are willing to "take a
chance" and save the expense of hail
insurance by withdrawing from the
state fund; others do not desire to
bind themselves to insurance until
they ascertain whether or not they
will have crop. Some areas are
supposed to be particularly liable to
hail and others free from it, and
farmers in the former desire insur-
ance while in the latter areas they
wish to drop it. This natural devel-
opment, according to one { official,
will lead to steady decrease in the
hail insurance acreage SO long as
the same rate applies to every Sec
tion of the state, and in the end will
result in only those areas particu-
larly liable to hail being insured,
which would force very high in
surance rate.
Another spokesman suggested that
as diversification in crops increased,
and vast acreage of grain passes,
the natural result will be aNdiminu-
tion in the amount of hail il.insurance.
I Commissioner of Insurance S. A.
Olsness favors removing the limit
Of so cents an acre on $500 an acre
insurance, which the legislature plac-
ed. providing at the same time that
if this tax was not sufficient to pay
all losses in full, the losses should
be prorated.
Mr.. Olsness says the 50-cent max
imum was not placed in the law by
the legislators to prevent the insur-
ance from becoming burdensome.
81 was present at all the caucuses
and committee meetings dealing with
the discussing and framing of the
original hail law, but / never heard
that argument advanced" he said.
Maximum Levy Wrong
If we could prevent insurance
from becoming burdensome by SIM
ply setting our own limit as to the
premium rate we want to pay it
might have been placed at still
better figure than so cents. The
only reason ever presented was this,
advance by the attorney who assist
ed in drafting the law, that unless
some limit was prescribed, the law
might be unconstitutional. The linn
it was then set at so cents, which
was assumed to be safe. I stood out
against this arrangement all the
time, as I could not see why there
should be any distinction in this re-
spect between state hail insurance
mutual and any other private or CO.
operative mutual covering other
kinds Of insurance. know Of no
other such Insurance plan where
premium and indemnity are limited
in this manner preventing the insur-
ed from collecting damages in full
in case Of total loss. do not be-
lieve the absentee Of . maximum lin
it would render it unconstitutional
and hope that the next legislature
will remove this abnormity from ohr1
present law" n
In naming the .reasons for the
heavy decreases in acreage insured,
tcontinusd oa lrsse .
ss @ w n BY 80, 3Si5