Page 421 - The_story_of_the_C._W._S._The_jubilee_history_of_the_cooperative_wholesale_society,_limited._1863-1913_(IA_storyofcwsjubill00redf) (1)_Neat

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The Insurance Discussions of 1898.
The Co-operative Insurance Company, Mr. Tweddell further
contended, was not " adequately satisfying the needs and aims of
the movement "
Its profits are disposed of by first paying 6 per cent interest to its share-
holders; and, secondly, in banking up the surplus in the form of reserves,
which remain the exclusive property of the shareholders, and in which the
policy-holders are allowed neither part nor lot. It holds 48,924 fire risks, and
if it stood upon a true co-operative basis every one of those risks would
participate in its profits instead of the whole being absorbed by a sj'ndicate
of 509 shareholders.
. . . The Wholesale Society, embracing as it does the
vast majority of co-operative institutions, and representing as no other agency
does the trading interests of the movement, is admirably adapted to deal with
tliis important question. By organising an insurance department on similar
lines to the bank arrangements could be made by which perfect mutuality
could be secured, a desideratmn which I consider is imperative in any scheme
of co-operative insurance.
In addition to Mr. Tweddell's paper a departmental memorandum
was submitted to the Committee, a statement much more cautious
and doubtful concerning the inclusion of big risks and small in one
general insurance scheme:
From 1877 we have had seven fires, on account of which we have received
from outside companies in compensation for damage done the sum of £31,000;
whilst during the same period we have paid to such companies in premiums
the sum of £36,396. If we take the normal proportion of losses to premiums
at 50 per cent, these losses should not have reached £20,000. The insurance
companies may thus be said to be losers to the extent of over £11,000 through
their insurance business with us during the past twenty-one years, whilst, on
the other hand, the risks retained by the Society have yielded a very handsome
profit.
It is only right, however, to bear in mind in considering these figures that
the fire at London Branch alone accounts for £23,053 out of the £31,000.
This was in accord with Mr. Odgers's statement of C.I.S. experience,
when, writing in the Co-operative News of March 21st, 1898, he said,
" the insurance of excess risks resulted in loss to the offices which
undertook them, and the amounts retained by the C.W.S. resulted
in profit." The C.W.S. , however, was covering more than half the
totals of its seven biggest risks, and undertaking much more than
the C.I.S. could venture to do; while Mr. Tweddell took the view
that elaborate modern precautions had taken the terror out of large
risks. Co-operators had their watchmen, own fire brigades,
sprinklers, fireproof doors, and the rest, while local authorities, " in
all the large towns where our property exists," were constantly
improving their measures against fire, and " to the extent that we
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