Year: 1874

The Insurance Problem.


Underwriters in declining any further risks
upon property in Chicago opens a delicate
and important question. The measure is of
so unusual character that nothing but
extreme necessity would justify it. 1t is
serious thing to withdraw the protection OF
the most powerful insurance combination in
the country from one of our largest cities.
The practical effect OF this will be to rule out
Chicago from the insurance boards of Europe,
for what New York rejects cautious London
will hardly accept Unless property in Chi
cago can have that protection from capital
which insurance happily affords, it will be
impossible for any moneyed interest outside
of Chicago to invest in its real estate. The
proposition that Chicago should form COM
pany of its own with capital of fifty millions
Of dollars is Characteristic of the courage OF
the merchants of that intrepid city, but it
does not seem to be feasible The rate
necessary to make insurance profit when
serious tax upon the property of the north
western metropolis.


We observe that the President of the Chi
cago Fire and Police Board proposes that
there shall be a city department called
the Board Of Insurance, which Board
shall insure all the buildings and
property therein, collecting therefor a
rate of insurance to be determined by the
Board, the premiums received for ten years to
be set apart as an insurance fund and an an
nual tax to be levied to pay the losses likely
to occur during the year. When the insurance
fund shall become large enough to yield an
annual income equal to the losses then the
tax to pay the same shall be discontinued.
This plan the Tribune calls the quintessence
of folly, saying aptly that the human mind
can understand no greater encouragement
to incendiarism than . standing offer
to make good every mans loss by
fire." We al know what this editor
truly says, that insurance is business that
has engrossed the attention Of some Of the
ablest minds in all countries, and, despite the
experience and observation of centuries, the
system has not yet been SO perfected that,





can be made profitable IL 1872 the insur-
ance done in Chicago represented a cash
capital Of thirty-six millions of dollars. The
business in Illinois during 1872 was a pros
porous and profitable one; but the business
for the five years ending December 81 1872,
ceipts of over forty.fve millions OF dollars.
The Tribune urges the Fire Commissioners to
resign, and at the same time says that there
can be no doubt that soon after the meeting
of the State Legislature Chicago will have d
building law enacted and then, if not before.
reorganization of the Fire Department, while
the work of replacing the water mains with
those OF larger size will continue. Reforms
like these the Tribune says, (which
should have been consummated long ago,
coupled with the extraordinary vigilance
which withdrawal of insurance will necessi-
tate will combine to reduce the losses OF in
surance companies to a minimum, and cor
respondingly increase their profits


We shall rejoice in the passage Of such q
law as will enable Chicago to enjoy the bene-
fits of that fraternity in capital which is Illus
trated so wisely in insurance. The problem
is one which concerns the whole country, and
if some means could be found to combine all
the insurance interests Of the States into one
national company, in some way under the
care and protection of the government it
would be better for all concerned. In the
meantime let us trust that Chicago will learn
the lessons taught by her Incredible misfortune
and build city which will defy and not in
vite destruction.