45 



For many years the people of Canada have felt that the tax 

 for fire insurance is unduly high, but, instead of blaming themselves 

 for creating and maintaining conditions that cause excessive fire 

 waste, have, in large part, devoted their attention to the insurance 

 companies. While not contending that the insurance companies are 

 altruists, it should be borne in mind that they are simply playing 

 the part of distributors. They collect a certain amount of money 

 from the insured, deduct certain amounts for commissions to insur- 

 ance brokers, for office and other expenses of mana- ement, for divi- 

 dends to their stockholders, and pay out the renu'.fldpr to policy- 

 holders who have sustained fire losses. Obviously, if 'fire losses in- 

 crease, rates must be raised to meet such losses. O-- '^e other hand, 

 if there were no fire losses, the insurance companies would have to 

 go out of business. 



The fire loss in Canada is increasing at an alarming 

 Rts?^n^iSe rate, the total for 1918 being 833,623,000, as compared 



with 824,800,000 in 1917, 825,600,000 in 1916 

 and 819,022,000 in 1915. In 1918, there were 276 fires, causing a loss 

 of $10,000 or over, as compared with 238 in 1917, 218 in 1916 and 

 237 in 1915. The largest monthly total was that of October — 

 $5,119,145 — which included the explosion in the munitions plant at 

 Trenton, Ont., resulting in a loss of 83,000,000. 



Mr. J. Grove Smith's investigations demonstrate that a few 

 fires cause two-thirds of our fire loss. In 1918, we had 17,355 fires in 

 Canada, entailing a loss of $33,623,000, but 823,236,000, or 69 per 

 cent, of that loss was caused by 276 fires. Again, only 62 fires were 

 responsible for a loss of 814,650,000, or 44 per cent of the total loss. 

 Small Percentage ^^"ch eloquence has been devoted to the advocacy 

 of Loss due to of an educative campaign to instruct the children of 

 e ing ires Canada respecting greater precautions against fire, 

 the basic idea being that many fires would thereby be prevented. 

 While recognizing the great value of such education, it must be borne 

 in mind that, even if the 12,000 dwelling fires which occur every 

 year were prevented, it would only reduce our fire loss by 5 per cent, 

 whereas, if the less than 300 fires which annually damage large mer- 

 cantile establishments and manufacturing plants could be prevented, two- 

 thirds of our fire waste could be avoided. 



Mr. Smith recommends that the following legislation be enacted : 



(1) Requiring a signed application (on a standard form) for all 

 insurance, the statements in such application to form a condition 

 of the insurance contract and a continuing \\arranl\- ilurini; the 

 currency of the policy. 



(2) Reciuiring the registration and licensing of all agents and 

 brokers placing insurance with companies ojK'rating under Hominion 



