The Conservative (Nebraska City, Neb.) 1898-1902, July 14, 1898, Page 4, Image 4

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    the Conservative.
WITH TIIK OM > During Hie last
STAMiAKi ) . presidential ( Hi m-
paign a public speaker seeking high
office said :
"The promulgation of the gold stand
ard is an attack upon your homes and
your firesides and you have as much
right to resist it as to resist an army
marching to take your children captive
and burn the roof over your head. "
But under the gold standard during
the last half century imprisonment for
debt was abolished.
Under the gold standard most states
, of the American Union have passed
laws exempting homesteads and largo
values in personal property from execu
tion for debt.
Under the gold standard , liens have
"been provided for mechanics and labor
ers that secure their wages iipon the
jwwjwty 'Whereon they put forth their
Under the gold standard , laws have
been passed permitting poor persons to
sue in the coxirts , state and national ,
without the payment of costs or the giv
ing of security for costs.
Under the gold standard , laws have
been passed providing for the appoint
ment of attorneys to defend at the cost
of the state impecunious persons in
criminal courts and in some instances in
the civil courts.
With the gold standard , laws have
been so constructed that courts are com
pelled to enter judgment in favor of
laborers who have to bring suit to recover -
, cover wages , or enforce their rights
against a corporation , for a stated sum
to reimburse them for attorneys' fees.
Wjth the gold standard , the wages of
"lilbo ) ' Juive been made preferred claims
in tibe administration of estates.
With njjo gold standard , laws regula-
. tting passenger and freight rates xipon
railroads and other transportation lines ,
# nil likewise regulating the charges of
-warehouse-men and elevator-men have
been instituted. This shows how false
and flagrant the charge is that legisla
tion in this country has been dominated
by corporations during the last fifty
With the gold standard , in full vigor ,
national and state commissions have
been created for the supervision of rail
way traffic ; and the charges for carrying
passengers and freights under this gold
standard have constantly declined.
Under the gold standard in the state
of Nebraska and throughout the North
west , and in fact throughout the whole
United States , the rates of interest upon
money have declined and the rates ol
wages have increased.
In another issue CONSERVATIVE
will depict further disasters that have
como to the country because of the gel <
Man in all his civili/ed career luus
never successfully used anything as
money which did not have value as i
commodity before it became money.
VAi/trKi , > iN.simQUERY : "What is a
A > ' < ! ; i oiicn-s. : Valued Policy of In
surance V
ANSWER : A Bad Trnp for Honest
It would appear that the customary
ittempt has been in Nebraska to force
ire insurance companies to issue what
s called a "valued policy , " in place of a
rue contract of indemnity. This effort
nay have been successful and if such
in act has been passed it is probable
hat all prudent underwriters have
vound up the insurance companies or
ganized in the state and that the pru-
lent insurance companies of other states
ind of foreign coiiiitries have with-
Irawn their agencies , leaving the peo-
) le of Nelmiska without the benefit of
my safe contract of indemnity on loss
jy fire of any kind. No insurance eom-
> any which will consent to issue what is
called a "valued policy , " except at a
ate of premium excessively high , can
exist or transact business under a valued
) olicy law. The reason is that by way
of what is called a valued policy law
the safe contract of indemnity contem-
) lated under policies of insurance is
converted into a mere gambling con-
ract or bet of a so-called premium re
ceived against the chances of a fire de
stroying the insured property at a fixed
value. Someone may ask : "Why , is
not that exactly what an insurance
company exists for 'i Are not all conTacts -
Tacts of insurance in the nature of
jets or wagers ? " Such questions simply
jxpose the ignorance of the person who
usks them and lead up to the question :
What is indemnity 'i
The true contract of insurance is a
contract of iixh-iiniitij. It is a contract
ntered into by a corporation in con
sideration of a given sum of money
under the name of premium to pay for
property destroyed by fire nt it mine
ut the thin1 of tin' Jii'i' whnterer ( lint nilni'
mity then In1. Let us take an example.
John Smith owns a house in Nebraska
City which he thinks is worth five
thousand dollars. He may be right and
ho may bo wrong. It may bo worth
five thousand dollars to him. It may
not be worth five thousand dollars to
anyone else. Ho insures it for five
thousand dollars , paying , say , twenty-
five dollars premium for one year. Dur
ing that year the house is totally de
stroyed. John Smith presents his claim
against the insurance company for five
thousand dollars. Where there is no
valued policy law John Smith and the
president of the insurance company
agree upon two men who shall appraise
the loss and if they do not agree a third
will bo called. This board of three ap
praisers finds that although John Smith
had valued the property at five thous
and dollars it was not worth over foui
thousand dollars. They then awar <
John Smith four thousand dollars ii
cash and that gives him a just measure
of indemnity for the actual loss by fire
That is a payment which is consistent
with public interest.
John Smith then gets mad. Ho says
10 has boon cheated. Ho says that ho
mule a bet of twenty-five dollars
igainst five thousand dollars that his
louse would not be burned. It has
joon burned and ho now says that he is
entitled to five thousand dollars ; that if
10 doesn't got it he will go to the leg
islature and compel insurance com
panies to make that kind of a bet. That
may have happened in Nebraska. Yet
John Smith is all wrong. Such a
gambling contract is against the public
"What has the public to do with the
matter V" someone asks. The answer is :
Svorything ; because the public in one
sense pays John Smith the amount of
lis loss. An insurance company distri
butes losses upon the community.
Nearly every person who has any pro
perty insures it against loss by fire , pay
ing a premium thereon. The losses and
expenses are paid out of the premiums ,
lot out of the capital of the insurance
company. The capital of the insurance
company is only a guaranty fund. If
the losses are so 'great as to exhaust the
premiums and to impair the capital no
one will subscribe to the stock in an
insurance company. The object of a
stock insurance company is to put in
capital in order to make an income or
profit. This capital is invested and
constitutes a sinking fund or safety
fund to be drawn upon for the benefit
of the assured in case of need. If the
premiums do not cover losses , expenses
and profits , and the capital is impaired
or lost , then the insxirance company is
wound up and the stockholders lose
their money.
When the insurance company is well
managed the premiums charged are suf
ficient to pay the losses and the expenses
and also to leave a profit , bo it more
or less , for the benefit of the stock
holders in the insurance company.
Someone then asks : "Why don't in
surance companies issue valued policies
for a profit ? " The answer is : That
there are a sufficient number of rogues
in every state who would insure their
property for more than it is worth
whenever they could get a chance ; then
set it on fire , let it burn and claim on
the valued policy the full sum named.
The rogues would get the temporary
benefit , the underwriter that made such
bets would bo ruined and the honest
members of the community would be
deprived of any safe method of distri
buting honest losses among themselves.
Someone will ask : "This is very
plain talk ; what 'does the writer know
about it ? " The writer will reply that
in the last twenty years ho has boon the
president of a factory mutual insurance
company which has issued true con
tracts of indemnity against loss by fire
to the amount of seventeen hundred