loss than are individually owned and operated vesaolo. This hian wan 

 prodicatcd upon the belief that fleets exercise stricter control over 

 the maintenance and repair of the vessels than do individual owners. 

 The hanks, hov;ever, in loaning on vessels, have historically judged 

 the quality of the risk hy the character of the vessel operator rather 

 than hy his affiliation. Mor? recently, insurance companies have tapjen 

 the same attitude. 



Shrimp "boat insurance at times has teen highly unprofitable 

 to the insurance companies. Many general agencies have ceased writing 

 insurance on such vessels altogether. Losses were particularly high 

 in 195^. There have been rumors in tl:i6 industry connecting this situar- 

 tion with the fact that shrimp industry profits were particularly low 

 in that year. Regardless of their validity, these allegations have had 

 detrT|,m9ntal effects on the ability of fisherman to obtain ins\irance. 

 In point of fact, the follo\tfing observation can be made: the preceding 

 year had been one of abnormally high profits and had attracted many 

 newcomers to the industry. The use of less exi:)erienced crews, in some 

 instances, may have had some bearing on the number of claims filed. 



Whatever the reasons for it, the abnormally high loss ratio 

 in shrimp vessel insvirance forces premium rates up. Many boat owners 

 do not carry insurance unless they must for purposes of financing. 



The answer to the insi-irance dilemma is not clear-cut. In- 

 creased emphasis on crew training would imdoubtedly reduce the loss 

 ratio and result in a lovrering of premium rates. The introduction of 

 a nev; typo of policy written especially for shrimp boats v;ould also be 

 beneficial, since existing marine insvirance policies fail to take into 

 account the special charBcteristics of the shrimp industry, Finally, 

 a stabilization of the market for shrimp would make the shrimp fisher- 

 man a better insurance prospect by tending to effect a decrease in loss 

 claims and policy lapses because of "bad years". 



Some examples of 1952 premiums are cited as follows: for a 

 wooden diesel shrimper valued at $25,000 (about one-half of the replace- 

 ment cost), the insured paid 5*^ percent ($1,350) which included hull 

 and limited protection and indemnity insurance for trips not exceeding 

 100 miles offshore. In a similar case the vessel was valued at $22,000 

 and the premium was $1,450 (6-1/2 percent); for a third vessel of this 

 type valued at $20,000 ($200 deductible) the premium v;as $977.50 or 4,9 

 porcent, for a marine research vessel of a university (hull coverage 

 limited to $10,000, protection and indemnity limited to $100,000 for 

 any one accident, $50,000 for any one person) the premium was $5'^'^«50, 

 Tliu policy in this instance covered LUe vessel only when used in 

 coastal or inland waters. 



223 



