money may receive, with the approval, a guaranty against loss in accepting it, which private examiners or counsel cannot give. Titles are insured also in other countries, but the business has nowhere else attained such importance, nor do the institutions transacting it make full and separate statements of their accounts. Other minor forms of insurance are against bad debts, bonds and securities in transit, earthquakes, failure of issue, loss on investment, leasehold redemption, non-renewal of licences, loss of or damage to luggage in transit, damage to pictures, loss of profits through fire, imperfect sanitation, birth of twins, &c.
III. Fire Insurance
The growth of the business of fire insurance since 1880 or thereabouts has been commensurate with the increase of wealth and of commercial activity in the foremost nations, while the practice of it has also become general in countries in which it was formerly little known. The statistics of the subject have in recent years become far more full and more accessible than formerly; partly because many governments require detailed reports of resources, receipts and expenditures from all companies permitted to establish agencies within their jurisdiction, and periodically publish summaries of the returns; but also largely because the companies seek the widest publicity as their best means of advertising. It is to be regretted that there is as yet no uniformity of method in these returns; while some of the most important elements of the subject are not sufficiently illustrated for the student in the published statistics. Many companies of the United Kingdom transact business throughout a great part of the world, and there is no means of determining how much of their receipts or their losses must be referred to Great Britain. Further, they fail to give classified amounts at risk, so that it is impossible to estimate with any confidence the total sum for which any kind of property, such as dwellings, factories, household goods, stocks of merchandise or wares in transit, is insured. The returns of the London Fire Brigade, however, which is in part maintained by regular contributions from the fire underwriters at the rate of £35 for each £1,000,000 of risks assumed by them within the metropolitan district, continue to exhibit a regular growth. The aggregate amount insured in the metropolis was reported as follows:—
| In 1882 . . | £696,715,141 |
| 1886 . . | 741,109,316 |
| 1890 . . | 806,131,385 |
| 1895 . . | 858,899,409 |
| 1900 . . | 963,291,097 |
| 1905 . . | 1,034,819,587 |
It appears probable that the rate of increase here shown is not greater than the actual growth of insurable property during the same period, so that it may be reasonably supposed that the custom of protecting all exposed property by insurance was already general in London many years ago. 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; but many of these do but a nominal amount of business, and twenty-three of them are exclusively or chiefly engaged in re-insurance. This tendency has been a marked feature in the later history of fire insurance everywhere. The companies which are now in the field are the survivors of tenfold as many projected enterprises which have failed. The records of about two thousand organizations for the purpose, in America alone, which have undertaken the work and disappeared within fifty years, show the dangers to which inadequate skill and capital are exposed. But a small proportion of these failures were the direct result of sweeping disasters, though about seventy of them followed the memorable fires in Chicago and Boston in 1871 and 1872. Many more, nearly one-half of the whole, have followed a short career, in which the helplessness of inexperience to compete with long training and complete organization was demonstrated. Many hundreds of these projects were mere speculations or even frauds from the beginning; and the better education of the community at large in the principles and methods of insurance has been the chief agent in checking such enterprises, aided by the stringent legislation of several countries and of the United States in America and by the criticism of the press.
The difficulty of establishing a new joint-stock fire insurance company is far greater in the present highly perfected state of the business than formerly, and constantly increases. The reports of the state insurance departments in America show that less than one-eighth of the premiums are now collected by companies founded since 1880; and, except in districts remote from the principal financial centres, or mutual associations for special classes of hazards, new companies are not often formed. In Great Britain a considerable number of new corporations are registered every year, with fire insurance among their professed objects, but almost always in connexion with some forms of casualty insurance, which appear to be practically the purpose in view. The reports of the fire business in the United Kingdom for recent years, as collected in Bourne’s Manual, show that less than one-fourteenth of it is done by companies organized since 1870. Though new companies have been registered, usually several every year, the number actually transacting successful business has not increased since 1880. Of the various British companies now recognized, the twelve smallest together collect but 1% of the premiums received by one of the largest, and the tendency to concentrate the business seems progressive. These facts are explained by the necessity of a vast basis of average and of a large capital for security, and still more by the increasing demand for a thoroughly trained and organized body of agents, able to protect their companies from fraud and imposition, and at the same time to compete for public patronage.
The Mutual principle has a strong attraction for many insurers and projectors. When a large number of pieces of property, so distributed that a single fire cannot destroy a considerable proportion of the whole, are yet owned and controlled by persons who can fully trust one Mutual system. another, both for financial responsibility and for good faith, there may be no need of a large capital in hand, nor of much of the costly machinery required for general competition. A contract for the assessment on all the property of losses as they occur, at rates fixed by the estimated exposure, may form a safe basis for an association. The fixed payments may be limited to necessary expenses, with a moderate reserve for emergencies, all excess of collections to be returned to the insured. This simple conception of an insurance association, with such modifications as experience indicates, has been accepted for a time as ideal in almost every civilized community, and attempts are continually made to realize it, but in the vast majority of instances with complete failure as the result. Like every other product of human skill, insurance is, for the most part, best supplied to the market by those who make it their calling to produce it for gain. But while the mutual plan has proved poorly adapted to the general service of the commercial world, in some communities, and especially among the owners of certain classes of property, it has achieved great and apparently permanent success. This is particularly true of manufacturing districts, in which numbers of mills and factories are exposed to peculiar danger of fire by the nature of their own operations. The best safeguard they can have is by employing great skill in the construction, arrangement and conduct of their works. A group of such properties, associated for the prevention of loss, is naturally stimulated to highest efficiency when the whole group undertakes to bear all losses which are not prevented, and thus every member has a strong interest in making the protection complete. It is in associations of this character that the mutual plan of fire insurance has rendered its greatest services. The mutual plan has been widely adopted also in local associations for the insurance of dwellings and farm improvements, where the individual risks are small, and where technical classification and special safeguards against fraud are not considered necessary, often with the result of affording satisfactory protection at low rates. But the ratio of this part of the business to that conducted by joint-stock companies diminishes from year to year, even in the agricultural and rural districts of the United States. According to the reports of the insurance departments of the states, as summarized in the
