26 DEPARTMENT BULLETIN 912. 



all classes of insurance institutions were, respectively, as follows: 



1914, 48.2 per cent; 1915, 121.3 per cent; 1916, 87.3 per cent; 1917, 

 50.7 per cent ; 1918, 63.7 per cent ; and 1919, 47.8 per cent. With such 

 variations occurring when the experience of all companies and or- 

 ganizations operating in a large number of different States is taken 

 into account, including those operating on an assessment plan and 

 whose premium income is adjusted on the basis of losses already 

 incurred, it will be apparent that the loss ratio to be expected during 

 any given year is highly problematical when the figures for a single 

 company charging a fixed premium rate and operating in a severe 

 hail district, are considered. More particularly is this the case when 

 such company limits its field of operations to a relatively restricted 

 area. 



One of the larger mutuals operating in Kansas collected premiums 

 during 1914 amounting to $108,459 and incurred losses of only $19,649, 

 or a little over 18 per cent of the premiums. During the year follow- 

 ing, 1915, the same company collected premiums amounting to 

 $348,389 anoi incurred losses of $651,173, or nearly 187 per cent of the 

 premiums collected. For the first of the two years mentioned this 

 company was, of course, able to pay back to its members a substan- 

 tial rebate, besides adding a considerable sum to its reserves. In 



1915, however, only the accumulated reserve on hand, coupled with 

 the fact that a considerable part of the risks had been reinsured, 

 saved the company from being obliged to prorate its losses, since it 

 collects a fixed premium without contingent liability. Most of the 

 other Kansas hail mutuals, which also operated on a fixed-premium 

 basis, were obliged to prorate their losses in the year last mentioned. 



One of the joint-stock fire insurance companies writing hail in- 

 surance in Kansas in the year 1908 collected hail premiums amounting 

 to $134,498 and paid losses amounting to $214,633, or 159 per cent 

 of the premiums. In 1912, on the other hand, the same company col- 

 lected hail premiums nearly as large as those of 1908, namely, $112,- 

 889, while its losses were only $39,653, or 35 per cent of the receipts. 

 The State of Oklahoma has in recent years shown variations in hail 

 losses quite as great as those of Kansas. In 1915, two of the joint- 

 stock companies with a relatively large hail business in this State 

 had loss ratios of 112 per cent and 192 per cent, respectively. In 

 1918 the same companies had loss ratios in the State of only 18 per 

 cent and 30 per cent, respectively, and one other company with nearly 

 $90,000 in premiums had a loss ratio of but 7 per cent. In 1916 one 

 of the joint-stock companies operating in North Dakota collected 

 premiums amounting to $206,424, and paid losses amounting to 

 $245,767, or 119 per cent of the premiums, while in the following year 

 the company had premiums in the same State amounting to $146,516 

 and paid losses of only $66,996, or 46 per cent. Even more extreme 

 variations in loss ratio could, of course, be cited by giving the ex- 

 perience of companies with relatively small amounts at risk. One of 



