HAIL INSURANCE ON FARM CROPS. 21 



insured twice as long as another without affecting the premium 

 charges for such insurance. 



All the joint-stock fire insurance companies, so far as known, limit 

 themselves to a policy covering a specific crop growing on a desig- 

 nated piece of ground. The same is generally true of the mutuals 

 operating west and south of Minnesota and Iowa. In the States 

 just named, as well as in the States farther to the east, a number 

 of the mutuals write a term policy for either three or five years and 

 cover certain enumerated crops on a given farm. One very successful 

 mutual, in fact, writes a perpetual policy which means, of course, 

 that the insurance contract continues in force until canceled either 

 b}^ the insured or by the company. 



While the disregard of the time element in the typical hail policy 

 at first sight appears highly inconsistent, it is again, in part at least, 

 explained by the peculiar nature of the objects insured. Even though 

 hailstorms may be no more frequent or severe in the latter part of the 

 season during which the hail policy is in force, the risk in the sense 

 of probability of loss may be said in the case of most crops, at least, 

 to increase rapidly as the time of harvest approaches. During the 

 early stages of the growing crop the ravages of hail storms may cause 

 a set-back merely, without materially affecting the final outcome or 

 yield. As the crop develops, however, the possibility of such re- 

 covery becomes more and more remote and eventually disappears. 

 Furthermore, a hailstorm occurring at the time when the crop is 

 ready for harvest means not only that the damage wrought is irrep- 

 arable, but a larger percentage of the stems of grain are actually 

 broken, than would have been the case at an earlier stage. The heads 

 on broken stems drop to the ground, while the heads on unbroken 

 stems may have lost a part of their contents. 



The difference between the hail policy and the fire policy, already 

 pointed out, is based mainly on differences inherent in the objects 

 covered by the insurance. Additional differences arise from marked 

 dissimilarities in the hazards involved. The fire hazard originates 

 in two kinds of underlying causes, namely, natural forces or agencies 

 and bad or careless human actions. Of these two sources of the fire 

 hazard the latter is beyond doubt the more important. In the case 

 of hail insurance, on the other other hand, the hazard insured against 

 originates entirely in natural forces over which man has no control. 

 Most of the elaborate provisions against the so-called moral hazard, 

 which are embodied in the fire insurance policy, therefore, have no 

 place in the hail insurance contract. 



While an individual whose crop is insured can not by his own action 

 or lack of action bring about the occurrence of hail, he may, however, 

 under certain circumstances increase the apparent loss due to hail 

 by failure properly to care for a damaged crop after hail has oc- 

 curred. There is also the possibility that the description of the acre- 

 age covered be made so inaccurate or misleading as to appty equally 



