(From the Nautical Magazine for December.)

THE system of doing insurance which has been brought about by mushroom companies, projected by scheming secretaries, in order to obtain salaries for themselves and others, has completely set aside the old practice, and has materially altered the risks. Competition has rendered it easy to effect an insurance on any dilapidated " tub " to the full amount of her value, whereas it was formerly the custom to engage for no larger sum than would cover two-thirds of the worth of a vessel, which rule (as Mr. Gladstone, of Liverpool, lately averred) made the owners of many vessels cautious and careful in their outfit and repair.

Little did we think, when the paragraph just quoted was written, that any witness would be bold enough to tender such full and, unbiassed testimony upon the subject, as was requisite to explain to the Committee on Shipwrecks all the evil consequences that arise by abuse of the protective benefits of insurance. A witness of this fearless and candid disposition, however, did present himself. John Powell. Esq., a member of Lloyd's, has laid bare all the faulty workings of our system of insurance, which conspire to lessen those precautions which should be observed in the outfit and management of merchant vessels. He has proved that vessels are sometimes wilfully wrecked, for the object of gain, by recovery upon a multiplicity of policies : he has disclosed the fact, that remuneration for total losses has been claimed from the insurers upon vessels which very shortly afterwards made their appearance. That losses are, in certain cases, more profitable to the insured than safe arrivals that it is on these occasions that the mariner, after his hazard and labour, is deprived of his wages to add to the gain of the ship-owner ; that the barratry of the master, and the consequence of his wrong doing in regard to another vessel not under his charge, are all covered by the responsibility of the underwriter ; who, moreover, makes good the smuggler's loss.

All these results are attributed to the eagerness of competition : but at the same time it should be recollected, that competition has reduced the cost of marine insurance twenty-five percent. This last effect might be considered an advantage, if it were not counterbalanced by the destruction of vessels which might and would have been preserved if so great facilities did not exist for effecting insurances upon vessels not faithfully repaired or liberally fitted. It will perplex no one, after what Mr. Powell has related, to account for the failure of the St. Patrick Insurance Company, which, after a career of eighteen months or two years, wound up its accounts with a loss of �25O.000. The money might have been laid out better, and no doubt the shareholders think so.

Sir Charles Napier, who seemed astonished at parts of Mr. Powell's evidence, demanded - " Are ships ever lost on purpose ?" Yes ! said the witness, and sometimes from the neglect of captains and officers ; yet, in either case, the insurers pay - " good easy men," they pay, " full surely " - and generally as a matter of course. Admitting this statement to be true, can there be a doubt about the correctness of Mr. Powell's opinion, when he says - it would be of advantage, not only to underwriters, but to the whole country, and cause a still further reduction of premiums, were enquiry to follow the loss of a ship?

The underwriters would certainly be benefitted by any measure which would induce increased caution in the navigation of merchant vessels; and it is equally evident that the country would gain, since every loss of property is a national loss, as well as a loss to the individuals upon whom it immediately falls. The claims for total losses and for averages, are greater than they were, making due allowance for the increased tonnage. Here is an effect - what is the cause of it ? That many ships had been designedly wrecked we do not believe ; let the mischief be attributed to carelessness or anything less blameable ; still some endeavour should be made to lessen its amount. The propriety of making such an attempt seems to be acknowledged at Lloyd's, for Mr. Powell expressed his approbation of the proposal of Captain Fitzroy, albeit the late Trinity-house colleagues of that gallant officer are opposed to it.

Next in importance to guarding as much as possible against shipwreck, is the business of defending shipwrecked property from plunder, when thrown ashore. Several naval officers have given evidence that robbery of this character is committed on many parts of our coast, and that the offenders, some of them decent looking farmers, really believe that they are doing no wrong in appropriating to themselves anything worth carrying, that the storm brings within their reach. They say it's a "Godsend," and calculate upon the probabilities of the happy event occurring to enable them to give their wives new gowns. It is common with them to stop the clamours of a noisy creditor with " I'll pay you next wreck ;" and the promise passes as one of fair hope of a satisfactory settlement. Thus the underwriters, like the young progeny of the turtle, are preyed upon in the flood and on the sands ; but it is not always and in all places that the wreckers go to their work and do it in real or pretended ignorance of its atrocity. This is shown by a well authenticated instance narrated by Mr. Powell, of the cunning and caution of wreck robbers at Whitstable.

[The foregoing, which we quote from that valuable paper, the Shipping Gazette, is a pretty dish to set before our readers ; and yet it is in a few words what has been in these pages long ago. We trust that our seamen will consider it well, for let them remember the " tubs" which some of them sail in, may be insured, but their lives are at stake in them: with regard to the ruin of an Insurance Company when competition in this art goes so far as to leave the seaworthiness of the ship to be insured out of the question, all w e can say is, they richly deserve it.]

P 71 - 18 May 44

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