support such a recoiimsndation. Tlie reader will be able to find in the 

 report several reasons for this viev. \-Jhile there may be some advantages 

 such as better maintenance as a result of higher income, the objections 

 to such, a policy are more numerous and may be summed up as follows: sup- 

 port of receipts from fish landings would have doubtful results, especially 

 in alleviating the protection and indemnity insurance problem because the 

 problem will still remain unsolved to the extent that accidents are not 

 induced by low earnings. If the purpose of such a policy would be to pre- 

 vent accidents and reduce their severity, the expected benefits are likely 

 to be much less than the incurred cost and wholly ephemeral. In sum, the 

 effects of an earnings- subsidy program will amount to a postponement 

 rather than a lasting solution of the insurance problem. 



Second, for similar reasons any attempt on the part of the Govern- 

 ment to establish a reinsurance program, either for hull or protection 

 and indemnity insurance or for both, is not advisable . Reinsurance is 

 not a guarantee that the cost of insurance to the o\-/ner will necessarily 

 go do'vm. This report offers a host of indications leading to the firm 

 conclusions that reinsurance will worsen loss experience. In addition, 

 everyone but the o"vnier who represents a good risk is likely to benefit 

 from such a program. Assuming that the reinsurance program includes 

 adequate safeguards and incentives to improve loss experience, observ- 

 ance of these provisions will be practically an impossibility. Finally, 

 leading underwriters in the field of marine insurance also do not think 

 that reinsurance is a desirable solution of the problem. 



Third, any government program aimed at alleviating the insurance 

 problem should be guided by the following general rules: (a) The 

 program should consist of measures which are likely to improve directly 

 the prevention of accidents and reduce their severity; (b) Government 

 expenditures should be made as much as possible on a quid pro quo basis 

 so that the benefits which a vessel o\mer may derive from the pi-ogram 

 will be in proportion to his efforts to improve the insurability of his 

 vessel; (c) the benefits of the program should be given as much as 

 possible in terms of services rather than in direct payments to individ- 

 uals; (d) expenditures should be made on measures which are likely to 

 yield the best result for the cost involved; and (e) the program should 

 attack the insurance problem from as many directions as possible by 

 Integrating the recommendations into a well coordinated master plan. 



Fourth, in view of the physical inadequacies of the majority of 

 commercial fishing vessels, an intensive engineering study is highly 

 recommended. Such a study will aim at accomplishing the following 

 general objectives: (a) survey the physical inadequacies of commercial 

 fishing vessels from the vievrpoint of navigation and safety devices; 



