Fire insurance

“ There is money to be made, and large dividends may be earned, by furnishing insurance against fire. Consequently the owner of every building in every city is constantly reminded by insurance agents of the importance and necessity of fire insurance. This has been done until public education, stimulated by private profit, has created a habit of thought which instinctively recognizes the danger of fire, and insures against it. The property owner who now fails to carry fire insurance is commonly regarded as assuming an unwarranted risk. ”

“ According to the reports of the insurance departments of the states, as summarized in the 661 Spectator Company’s Year-Book, more than half of the cash premiums of mutual insurance companies are collected in the two manufacturing states of Massachusetts and Rhode Island.
It is, after all, only within a very limited field that the mutual principle can be adopted. The essential principle of fire insurance is the distribution of loss. It does not aim, directly at least, at the prevention and only in a secondary way even at the minimizing of loss ”

“ Policies of fire insurance are contracts whereby the insurers undertake for a stipulated sum to indemnify the insured against loss or damage by fire, in respect to the property covered by the policy, during the prescribed period of time, to an amount not exceeding the sum specified in the written contract. ”

“ If a grist-mill owner or a storekeeper has a busy corner of two Southern streets where passers-by congregate on market day, he gets the representation of a fire company or two, and from time to time sends in a risk to the head office, whose underwriters go nearly frantic in endeavoring to decipher the hidden truth in the dusty reports of these well-intentioned amateurs.
But it is not so in New England. In New England fire insurance reaches its proudest estate. It is a profession, and to its true votaries almost a religion. ”

“ A fire-insurance company which issues its policies upon real estate and personal property situated in another state is as much engaged in its business when its agents are there under its authority, adjusting the losses covered by its policies, as it is when engaged in making contracts to take such risks. If not doing business in such case, what is it doing? It is doing the act provided for in its contract, at the very place where, in case a loss occurred, the company contemplated the act should be done ”

“ Another $7 billion is spent for fire departments, fire insurance, and related costs.
The richest and most technologically advanced nation in the world, we nevertheless lead all the major industrialized countries in per capita deaths and property loss from fire.
Most fires can be traced to a lack of active concern for fire safety. Unfortunately, the innocent-the very young and the aged-are most frequently the victims. ”

“ So in reference to fire insurance. While it is shown by one of the witnesses that fire insurance could have been procured on 'goods lying on the wharf by the side of the ship, before they were actually taken away,' the clause in question did not require that the consignees should have anticipated that their goods would be unloaded at night and deposited on the wharf. Aside from this, it is ordinarily essential, in a fire insurance policy, that the locality of the risk should be specified. ”

“ By the very law of their being, companies whose principal business is to provide insurance against fire, but who provide casualty insurance in a very narrow field, are in a class of their own, with capacities and opportunities essentially diverse from those of companies who are incompetent to provide insurance against fire, but who do insure against almost every other imaginable risk. ”

“ One aspect of the taxation of fire insurance is of especial interest, namely, the very general disposition of legislatures and municipal authorities to impose upon the underwriters the cost of fire departments. ”

“ My second amazement is that fire insurance companies should continue to live and thrive against such apparently fearful odds, for I see whole villages and cities composed of buildings that seem expressly designed to invite speedy combustion, and at the same time to resist all attempts to extinguish a fire once started in their complex interiors. ”

“ One to each floor with an extra one for kitchen and cellar is good fire insurance. Be sure every member of the family knows how to use them. Nearly all fires start in a small way and a shot or two of liquid from one of these machines usually extinguishes any but the most stubborn blaze. ”

“ Such conditions have always been considered reasonable, because they give the insurers an opportunity of inquiring into the circumstances and amount of the loss, at a time when inquiry may be of service. And still more, conditions in policies of fire insurance that no action shall be brought for the recovery of a loss unless it shall be commenced within a specified time, less than the statutory period of limitations, are enforced, as not against any legal policy. ”

“ In its series of cheap scientific publications, freighted with useful information for the people, the Tribune is doing an important work of popular education, and deserves to be widely and liberally sustained.
Exposures in Fire-insurance. By William Frazier Ross. New York: D. Appleton & Co.
In the language of fire-insurance, all insurable property is subject to certain exposures or liabilities to take fire. For instance, a building so situated in relation to a storehouse of oils or spirits, that, were the liquids to take fire, they would flow toward it, is therein subject to an exposure. ”

“ Adequately to measure the risk of loss by fire demands not merely reference to an extended experience but a watchful regard to current changes. While the profits of fire insurance business fluctuate considerably from year to year, and seem even to follow cycles of elevation and depression, the tendency on the whole appears to be towards a growth of risk, although excessive competition among offices prevents the rates from rising in proportion. ”

“ They sought protection against some of the possible consequences of these risks, and they obtained a policy insuring them against all loss by fire, except fire caused by certain things, of which collision was not one. Against every other consequence of a collision than a fire, they remained their own insurers, but the risk of fire was no longer theirs. ”

“ But the transactions of the British fire offices have grown much more rapidly, and indicate that, outside of the metropolitan district, the practice of insurance has extended greatly. The returns show that there is a tendency to concentrate the business in the control of large capital and experience, for practically all the premiums received and losses paid were shared by thirty-one companies, although there are at the same time a greater number of corporations of foreign countries with agencies for fire insurance in the United Kingdom ”

“ Even of these a certain percentage are supposed to be wilful. There is no denying that the crime of arson owes its origin entirely to the introduction of fire insurance; and there can be as little doubt that of late years it has been very much increased by the pernicious competition for business among the younger offices, which leads them to deal too leniently with their customers ”

“ Every insurance company that insures from fire any property in the metropolis shall pay annually to the Metropolitan Board of Works, by way of contribution toward the expenses of carrying this Act into effect, a sum after the rate of thirty-five pounds in the one million pounds on the gross amounts insured by it, except by way of reassurance, in respect of property in the metropolis for a year, and at a like rate for any fractional part of a million, and for any fractional part of a year as well as for any number of years for which the insurance may be made, renewed, or continued. ”

“ American Mutual Insurance Co., 11 N. Y. 519, the insurance was against fire, but the policy exempted the insurers from any loss occasioned by the explosion of a steam-boiler. A fire occurred, caused by an explosion, which destroyed the insured property. The court, regarding the explosion, and not the fire, as the predominating cause of the loss, held the insurers not liable. Decisions are numerous to the same effect. Policies of insurance do not protect an assured against his voluntary destruction of the thing insured. ”

“ Fire insurance companies in Illinois, though organized in other states, have never been allowed to do a general casualty business. It is misleading to argue about them on the assumption that they are appropriately described as casualty insurers. For a long time they were restricted to the risks of fire, lightning, and tornadoes, and those of inland navigation and transportation. ”

“ Same—Same—Same.—An exception in a policy of fire insurance that the “company will not be liable for loss or damage occasioned by the explosion of a steam boiler, gunpowder, or any other explosive substance, except only such loss as shall result from fire that may ensue therefrom ”

“ Furthermore, there is the matter of fire insurance, not a large one, but growing in the course of years to an appreciable sum. The reason for better insurance rates on the brick house is one that makes the strongest appeal to a man, and that is, safety from the fear and fact of fire, protection for himself and family from a justly dreaded misfortune. Acting on this reason, the insurance company will put from 19 to 37 per cent higher rate on a frame or stucco than on a brick house. Besides, you can carry 20 per cent less insurance on the more substantial structure. ”

“ A very interesting inquiry, and one of vital importance to the actuaries of fire-insurance companies, is the relative liability to fire of different classes of occupations and residences. We already know accurately the number of fires which occur yearly in every trade and kind of occupation. What we do not know, and what we want to know, is the proportion the tenements in which such trades and occupations are carried on, bear to the total number of houses in the metropolis. ”

“ Keeping in mind the general intent of the contract, which was insurance against fire, we may, perhaps, arrive at the understanding of the parties by following the succession of provisions the policy contains. After having acknowledged the receipt of the premium for insurance of the property against fire generally, the thought seems to have occurred that railroad collisions might take place, causing damage and resulting in fire. ”

“ Our statute provides that the rates for fire insurance 'shall be reasonable.' Since the commissions paid to local agents naturally enter into the cost of such insurance to the public, and therefore influence the rates which must be charged to the public for such insurance, it is within the police power of the State to require that the commissions must be reasonable, otherwise such large commissions might be allowed as to impair the financial stability of the insurance companies, and thus imperil their ability to meet their financial obligations to their policy holders. ”

“ The distinction between an answer apparently complete, but in fact incomplete, and therefore untrue, and an answer manifestly incomplete, and as such accepted by the insurers, may be illustrated by two cases of fire insurance, which are governed by the same rules in this respect as cases of life insurance. If one applying for insurance upon a building against fire is asked whether the property is incumbered, and for what amount, and in his answer discloses one mortgage, when in fact there are two, the policy issued thereon is avoided. ”

“ On the contrary, all the record discloses is that the jury found that the agent knew, when the policy in the defendant company was issued and delivered to the plaintiff, that there was then subsisting fire insurance to the amount of $1,500 in another fire insurance company, and that such knowledge had been communicated to the agent by or on behalf of the assured. ”

“ It will interest you to know that the fire department of the city of New York has reached such a degree of excellence that the risk of serious damage and loss by fire has been greatly reduced, and, in consequence, the insurance companies have lowered the rate of insurance ”

“ But the people were still the arbiters of the fire cost, and the companies merely barometrically reflected the condition of the community as to fires. When fires are numerous and costly, the price of insurance must advance. Insurance is a tax which the companies collect in premiums from the many and pay out in losses to the few. But the idea remains the same.
"That is interesting," said the girl. "Now will you think me very stupid if I ask you to explain what all the terms mean as you go along? You spoke a moment ago of underwriting: I don't know what underwriting is. ”

“ The New York Times on November 3, 1917, [Pg 134] recapitulated the damage wrought by German incendiarism as follows:
"A graphic idea of what the fire losses in the United States owe to the work of war incendiaries may be gained from consideration of the fact that the total fire insurance paid in the United States in 1915, according to the figures of the National Board of Fire Underwriters, was $153,000,000. It is estimated that 60 per cent. of the loss by fires in this country is represented in insurance. ”

“ While the fire raged as yet unchecked,—while walls were falling with shock and crash of thunder, the streets full of galloping engines and ambulances carrying injured firemen, with clangor of urgent gongs; while insurance patrolmen were being smothered in buildings a block away by the smoke that hung like a pall over the city,—another disastrous fire broke out in the dry-goods district, and three alarm-calls came from West Seventeenth Street. ”