The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1926-02-16

= FUND SHOWS
SURPLUS
Assets Of State Fund Are
$3.50, O94.3l - Surplus
Totals S688, O33.78

Assets of the state fire and tornado
insurance fund 'totalcd 1898, 094 81
on December 81. 1925, an audit of the
department by FT. Burchard, Gland
Forks, shows.
During the six and onc-half years
Of its operation, the audit shows,
$303 .325.0l has bccn paid out in FIRE
and tornado losses,
Liabilities of the fund. the repors
shows. total only $145 O60.53. having
surplus of $G88.G3a IL.
Assets of the fund are listed as
follows: cash on hand $587, 6O5.lO;
premiums receivable. $l19,812 %;
bills receivable, So, G6S.O3; accrued
interest on warrants. $3,062.74; ac-
cruedN interest on credit deposits.
$G,O95.25; furniture and fixtures.
sl,522.84; prepaid reinsurance, $50,
42s.2B.
Operating Cost ) Per. Cent
During the entire period Of its
existence, the report shows. the de-
partment had gross income of ST.
460,604.6i and has pail gu. $214,6ll.-
SO as premiums on REINSURANCE
placed with old-linc companies or
1873 per cent Of the total premium
received. Tho operating cost for the
department during its existence ias
been $4,000 " three per cent of the
gross income. The net income has
been $743,G6G.05 or 500 per cent Of
the gross income.
The report lists all Of the risks
carried by the department, data on
cases in which risks Nhave been re-
insured. data on all cases in which
losses have been paid and other in
formation concerning its operation.
Commenting on the results of the
enterprise. Which was launched with
out an appropriation and depended
on premiums to meet risks. the re-
port said: "The cost Of operation
has been three per cent CT slightly
less than one third permitted BY 'ae
terms Of the law Of 1919 creating
the fund. The operating cost of old
line companies is 35 per cent CIR APP
proximately that figure.
Has Preferred Risks,
However. it must De understood
that this is statement OF fac.
rather than comparison drawn.
The state fund has he advantage OF
a monopoly of Class Of business
which II has taken by fiji. ct law
and without expense, practically, TO
the fund. 1t does NJ advertising,
supports no agents, pays no take
and has the further advantage OF
dealing in class OF risks involving
slight moral hazard
"Yet if compar. son is mae be-
tween the expenses of the depart
ment arl .'d-linc companies IN COM
parable items Of expense, the com,
parison indicates a very ceonomlcai
handling of .hc state insurance basi-
ness.
Estate Insurance 'lrs the advan.
tace. namely. that the prnpart'' OF
the state and its nc..ticai suoaN'
sions IS always fully covered end
amply protected whereas TINS mas
not always been the case in the past
where the ms-te- Of insurance was
left to the haphazard attention OF pub
Tic offici4l.s who were not eompens-
atcd for giving close attention ia
routine matters of this sort 1t Is
we'll known that losses have OCCURRED
to political subdivisions. because OF
lapscd policies and no insurance ano
many more losses might have oc
Cured in this way had there beer
more fires"
| Policy Causes Scramble
| commenting vi IHC PoiiSS VI
! insuring parts of certain risks witt
old line companies the report said
!"The department has pursued po.
lev Of distribution If reinsurance
that has permitted local insurance
agents in almost every community o
the state to handle portion Of thu
state business. While this metho'
is pleasing to many insurance agents
who heretofore never secured an.
state business, it has. at the sam
time, resulted in general scrambl
for this line of business with 1T
attendant effort to exert politica
null and all sorts of Influence.