CRIMINAL INSURANCES.
A copnvAPONDENT challenges a closer attention to the mischief which may arise from an abuse of insurance in the hands of per- sons using it for criminal purposes ; and the subject is one that certainly merits every scrutiny. There are two difficulties, of which, in the first instance, the remedies appear to be nearly incom- patible, but it is rarely that two beneficial measures are really con- flicting, and when they appear so, it is usually found that the na- ture of the necessity which embraces both has not been stated with sufficient comprehensiveness.
It is well known that insurance-offices derive a considerable part of their revenue from forfeited premiums ; and at the first blush it would seem the interest of an insurance-office to take ad- vantage of any flaw in the insurance. There are, however, coun- terbalancino.6 considerations to that apparent interest. In the first place, any office which distinguishes itself, as one of considerable note did some years since, by a frequent litigation of claims upon it, will find that the new insurances, which are the best source of vitality in an office, are repelled by doubts as to the good faith of the management. It would be so even if the frequency of litiga- tion were only a coincidence; but evidently the faintest suspicion that there was a purpose at the bottom of it would be most detrimen- tal to the particular office. Again, there is a general interest in the whole body of the insurance-offices in promoting the practice of insurance ; and that interest will continue until the custom of in- suring is not, as it is at present, limited to a small minority of the public. The principle of insurance is so thoroughly sound, and its laws have been ascertained, speaking generally, with so much accuracy, that the universality of the practice can only be a ques- tion of time. A contrivance which neutralizes and virtually nnllifies exceptional risks by rendering them universal, is too sub- stantially, and obviously profitable not to be adopted universally. The great check upon the progress of insurance is the feeling of uncertainty in the public mind, that the results will be attained by the payments of premium ; and while the existing offices have less business than they might have, it is their policy not to en- courage anything that can create doubt as to the validity of the instruments when once they are formally executed. It is there- fore the interest of the insurance-office to minimize doubts as to claims upon each and all offices. On the other hand, it is the interest of the public to prevent a criminal use of insurance; and although we are disposed to dis- countenance any class imputations, there is too much reason to suppose that one of the improvements introduced by civilization has been abused by the perverted ingenuity of civilization. Our correspondent, after alluding to the well-known case of Wain- wright, who poisoned his wife's sister, and perhaps his wife's mo- ther, gives further instances of this practice.
"Some years ago, when I was connected with the management of an in- surance company, it came to my knowledge that many if not most of the principal offices in London had refused to effectinaurances in Ireland. They found that upon a long experience the losses outweighed the gains. One office, I know, made an investigation into the circumstances of its outstand- ing policies, and the result was a great crop of frauds with a slight sprink- ling of attempts to murder." "The Reverend John Clay of Preston has written a fearful letter on the subject of the Lancashire Burial Societies, and he is a person in whose judgment and veracity great confidence is placed. Two instances in point come within my own knowledge. In one, a life-insurance office succeeded in resisting a claim ; the counsel on the other side abandoning their case, with a view of concealing the facts of it as they would have been proved:. it was quite clear that a young medical man had insured his sister's life and had then taken means to hasten her death. The other instance was in a case of fire-insurance, where the office was prepared to prove that the plain- tiff had wilfully set fire to his house; but it appearing in the course of the cause that the plaintiff had fraudulently overstated his claim, his counsel chose to be nonsuited in an early stage, professedly on that ground, not dar- ing to let the facts as to the arson come before the jury." "I have also knowledge of a recent ease in which I have little doubt that a bankrupt committed arson, and yet the insurance-office, commiserating his position, paid him a large portion of his claim. Every one conversant with maritime affairs knows how much insurance contributes to weaken re- sponsibility in shipowners, to say the very least of it. The consequences of such a state of feeling as regards the loss of life are appalling to think of."' The last subject has attracted so much attention, that material improvement will probably be made in the classification of ships and in the application of the law of baratry. We believe, how- ever, that if the actual amount of navigation at the present time be compared with past periods, it will be found that, by the im- proved character of officers, and by increased knowledge of navi- gation, by many checks upon the abuse suggested, the loss of vessels and the loss of life have been considerably reduced. Another check has been in the hands of the underwriters, who have, of course, estimated the increase of risk to themselves, , and have exacted a premium which has rendered gambling in ship- wreck rather more costly than it would otherwise be especially since much more complete machinery for supplying information is now available throughout the world. With regard to Wand insurance the case is somewhat different. It is only since 1844 that an adequate conception has been formed of the extent to which insurance can be carried. Its progress these last few years has been very striking, and there is no doubt that if the proportion of genuine insurances to criminal exceptions be compared, the results would not differ in their nature. from a nut merical comparison of honest traders in any other branch of com- merce and sharpers or felons. In English fire-risks the chances of loss when all summed up, including fraud among ahers, cannot be formidable when we remember the extreme cheapness of in- surance. It would be very unfortunate indeed, if fetters were put upon honest insurance in the attempts to check exceptional criminal insurance. Our correspondent, however, who is amply qualified to discuss the subject and give advice upon it, makes a suggestion that reconciles every difficulty. It presumes the appointment of a Public Prosecutor—a functionary already desi- rable on many grounds : then, in ease any insurance were cri- minally challenged, the insurance-office would pay the mo- ney over to the Public Prosecutor, leaving its appropriation to be absolutely determined by the result of the triaL In ease the charge failed, the money would go to the claimant; in case the charge were established, the money would go to the Crown. IV this ar- rangement, all requirements would be satisfied : justice would be secured ; the criminal attempt would be defeated, and thus the in- terests of society in suppressing the crime would be met ; but the special pecuniary interest of the insurance-office in a failure of the policy would be annulled, and for all honest purposes.the_prineiple of recognizing every regularly-effected policy as "indisputable" would be firmly established.
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