Year: 1867




From a carefully prepared list published
in last Tuesdays HERALD It appears that
an average of twenty-five large steamships,
owned by parties at or hailing from the
port Of New York. hayo been lost at
sea annually for the past ten years. This
is independent Of the large nAmber Of smaller
steamboats, and sailing vessels wrecked within
the same period, and makes. very startling
exhibit Of marine disasters When the value
of one large boat and its cargo is considered,
ii is not to be wondered at that those Of our
marine insurance companies that have been
engaged in doing an inflated business, pressing
up their dividends and rapidly redeeming their
scrip, should find themselves driven to the wall.


Insurance is a business in which none but
experts can hope to proftably engage. Yet
an insurance company is the most common
refuge for broken-d0wn merchants. When a
prominent man fails in business, unless he
becomes wine merchant or coal dealer, his
friends set him up as president of an insurance
company, and he receives . liberal salary,
secures large amount of premiums, makes
few imposing annual reports and ends by
going into liquidation. The marine insurance
business, in especial, requires prudence and
experience to insure success. The well known
number of marine insurance companies started
in Kentucky to do business at this port Before
long one Of these companies went overheard
and was soon followed by another and another.
A friend meeting Hoxie on the street inquired
Of him the cause Of the trouble. "Ob," said
Hoxie, "these Kentucky fellows are paying a
pretty high premium for teaching me the bus-
ness Of underwriting; that's ALL" A marine
insurance company in the hands Of inexpe-
rienced managers is very unlikely tS secure
permanent success. The modern plan Of
uniting the fire and marine insurance business
in one il also an undesirable innovation. A
marine insurance company should be restricted
from taking FIRE risks.


The main cause Of the heavy losses these
companies have experienced, however, is TO be
found in their recklessness in taking risks.
The Sun Mutual, which is now in so much
trouble, is said to have been in the
habit Of insuring vessels that had been
refused by other companies. There would
be no such exhibit of marine disasters
as we published on Tuesday IL the insur-
ance companies should refuse to insure any
but seaworthy and safe vessels. The compa-
nies have the whole matter under their own
control II they would refuse to take any risks
on the old, unseaworthy, rotten tubs which are
now readily insured and started on sea voyages,
we should have no bankrupt insurance compa-
nies and no such large annual sacrifice Of
property and life as at present No merchant
or shipper would intrust his cargo on vessel
which was refused insurance by the under
writers, and the reckless spirit exhibited In
/ sending unsafe and halfequipped vessels 10
sea would be effcctually checked. The rivalry
between companies, the desire to make large
exhibits on the part Of many new concerns,
and, above all, the brokerage system, lie at
the foundation Of the evil. No well estab-
lished company will pay commissions at all,
and no company doing legitimate business
can afford to allow ten or fifteen per cent to
broker. The brokers, rs q general thing, will
not be too particular in the sort Of risks they
accept when their commission is at stake. If
our marine insurance companies generally
will profit by the lessons taught by the dis
asters Of the past season and the consequent
difficulties Of the shaky companies, II will bo
well for themselves, for commerce and for
human life. They have It in their power to
stop these fearful exhibits of marine disasters
and the terrible sacrifice Of life that follows In
their train; by refusing to insure any doubtful
Cssssls; and for their own protection, as we'll
- ~ the public good, they should reform
thess present system Of doing business Al