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EMPLOYERS REINSURANCE CORP.,
Kansas City, February 9, 1951.

Hon. BURNET R. MAYBANK,

Chairman, Banking and Currency Committee,
Senate Office Building, Washington, D. C.

DEAR MR. CHAIRMAN: S. 114 (Ferguson) would authorize the War Damage Corporation to provide through insurance or reinsurance protection against liability imposed upon employers (usually regardless of fault) by workmen's compensation, occupational disease and employers' liability laws for war injuries or diseases sustained by employees and arising out of or in the course of employment. To the extent that such injuries and diseases do or are held to arise out of or in the course of employment (and this is quite probable, especially as respects war plants) liability would be imposed by such laws notwithstanding the fact that they result from war. The laws make no exception for war injuries.

In most States employers are required to insure liability under such laws or qualify with the proper public authority as a self-insurer.

Workmen's compensation and employers' liability policies so required to be carried do not and are not permitted by the States to exclude war injuries or diseases.

The insurance companies writing such business and the self-insurers, in turn buy reinsurance to protect them against catastrophe losses.

The reinsurance contracts do not now exclude losses from war injuries or diseases, but neither the insurance nor the reinsurance premium charges do or could contemplate the war hazard. Premiums are based on experience and sinceup to now we have fortunately experienced no workmen's compensation and employers' liability war losses in this country, the premium rates do not reflect the war hazard. Nor could they. No one can estimate the number or severity or location of war injuries and diseases. No one can determine the vulnerability of one factory as compared with another. No appropriate premium charge could be made by either the insurers or the reinsurers to cover this hazard.

Military authorities concede that war losses in this country cannot be prevented. The assets and reserves set up out of premiums which did not and could not. contemplate exposure to war losses would be quickly swallowed up.

Collapse of the insurance and reinsurance companies would leave without protection (both as respects war and nonwar injuries and diseases) employees and their dependents whom the laws were intended to protect and would preclude the insurance and reinsurance companies from meeting their obligations under other forms of insurance necessary to the economic structure of the country.

There is only one answer for this problem. England found it during World War II. Congress must provide through the War Damage Corporation or other machinery--for the absorption of these war losses in the workmen's compensation and employers' liability field.

I understand that the Ferguson bill (S. 114) which would further this result is pending in your committee but that hearings have not yet been held.

On behalf of my company, the insurance industry, the employers of America, the employees and their dependents, and continuance of American economy and the defense effort, I urge you to make every effort to have this bill brought on for hearings before your committee at the earliest possible time.

Respectfully yours,

Hon. BURNET R. MAYBANK,

J. B. ROBERTSON.

FORT HOWARD PAPER Co.,
Green Bay, Wis., April 10, 1951.

Senate Office Building, Washington 25, D. C. DEAR SENATOR MAYBANK: It is our understanding that earlier this year Senator Ferguson, of Michigan, introduced bill S. 114 which would revive the War Damage Corporation substantially along the lines provided for in the last war.

For a long period of time we have been endeavoring to secure adequate coverage against possible war damage through regular insurance channels but without

success.

Under the circumstances, and in view of our geographical position and vulnerability to a bombing attack, either in a declared or an undeclared war, we feel that prompt action should be taken so that property owners and industrial concerns, particularly, be afforded adequate coverage. As previously stated, we would prefer, of course, to handle the matter ourselves with private insurance companies if they would provide such coverage. We mention this merely so that

you will know that we do not look to the Government to provide something that is already available from non-Government sources.

It has been noted in reading bill S. 114 that the Reconstruction Finance Corporation would supply the funds to the War Damage Corporation. We think that this is unfortunate and wish that the matter could be handled in some other fashion, because it is our opinion that the Reconstruction Finance Corporation has outlived its usefulness and the need it was created to satisfy no longer exists. Certainly any legitimate business can secure adequate financing through normal financial channels. It is our opinion that RFC should be abolished.

Any effort on your part to provide adequate war damage insurance, you may be sure, will be greatly appreciated.

Yours very truly,

LEON H. REIDENBACH,

Hon. BURNET R. MAYBANK,

Banking and Currency Committee,

Vice President.

HARDWARE MUTUALS,

Stevens Point, Wis., March 20, 1951.

United States Senate Office Building, Washington, D. C.

DEAR SENATOR: It is our understanding that S. 114 is before your committee. It is our hope that you will see fit to set this bill for an early hearing. The subject of coverage of property and individuals against loss which may result from enemy attack is one which should not be put off or treated lightly. We trust that you will do what you can to expedite action on this bill.

Yours very truly,

JOSEPH B. BEACH, Secretary.

INTERNATIONAL ASSOCIATION OF

Lansing, Mich., April 17, 1951.

INDUSTRIAL ACCIDENT BOARDS AND COMMISSIONS,

Senator BURNET R. MAYBANK,

Chairman, Senate Banking and Currency Committee,
United States Senate, Washington, D. C.

DEAR SENATOR MAYBANK: I am writing to you to urge your support for the early approval by your committee of S. 114. As you know, that proposal provides for the reactivation of the War Damage Corporation with a provision for reinsurance for workmen's compensation losses due to war hazards.

There is considerable merit to the argument that it was never contemplated that workmen's compensation laws should provide benefits for injuries or death arising out of purely war hazards. Probably there should be Federal legislation relieving the employers of the United States of all liability for injuries or death arising out of purely war risks or hazards. However, while the over-all problems involved are being studied, it is essential to provide immediate protection for employers, insurance companies, State funds and employees against the economic disaster which might result in the event of an enemy attack on the United States and the courts hold that injuries or death due to such war risks come within the scope of the workmen's compensation acts. The inclusion of reinsurance for workmen's compensation losses due to war hazards in a reactivated War Damage Corporation would in no manner delay or impair the consideration of any over-all war damage legislation that the Congress might låter wish to consider. The early approval of S. 114 would definitely be in the best public interest. Very truly yours,

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JAMES L. HILL, President.

MARYLAND CASUALTY Co., Charlotte, N. C., February 14, 1951.

DEAR SIR: It has come to our attention that the above bill is now pending before your committee and that bearings will be held within a short time. Inasmuch as this is a matter in which we have a very strong interest we would earnestly urge your support of this legislation and the holding of hearings at the earliest available time.

There can be no doubt but what it was never contemplated, and it is unreasonable to expect, that insurance companies, State funds, or employers should be required to face the enormous potential liability for injuries or deaths caused by enemy attack. We would, therefore, urge an immediate attention to this matter which will lead to the reactivating and authorizing of the War Damage Corporation to reinsure workmen's compensation carriers against liability for losses due to hazards of war.

Yours very truly,

JAY W. PRESTON,
Resident Manager.

STATEMENT OF NATIONAL ASSOCIATION OF CASUALTY AND SURETY AGENTS, E. W. SAWYER, COUNSEL AND ADMINISTRATIVE DIRECTOR

To the Members of the Insurance Subcommittee of the Senate Committee on Banking and Currency:

At a regional meeting held on March 31, 1951, at Houston, Tex., the National Association of Casualty and Surety Agents, an association of some 400 agency offices located in metropolitan centers throughout the country, took the following action with respect to the bills now pending in the Senate relating to the War Damage Corporation.

"The officers and staff of the association shall communicate to the insurance subcommitee of the Senate Committee on Banking and Currency the views of our association as follows:

"1. This association favors the immediate reactivation of the War Damage Corporation.

"2. This association asks that the War Damage Corporation be empowered to provide, through insurance, reinsurance, or otherwise, (a) reasonable protection against loss of or damage to property, real and personal, and (b) reasonable protection against liability imposed under any workmen's compensation act, occupational disease act, or similar law, for injury or disease suffered by employeesarising out of or in the course of employment.

"3. The officers and staff of the association shall cooperate fully with the Government and with the War Damage Corporation in helping to work out the details of coverage, rates, and procedures."

NATIONAL ASSOCIATION OF INSURANCE AGENTS,
New York, N. Y., February 19, 1951.

The Honorable BURNET R. MAYBANK,

Chairman, Senate Banking and Currency Committee,

Senate Office Building, Washington, D. C.

DEAR MR. CHAIRMAN: This letter is to respectfully urge you to do all in your power to bring about a prompt hearing by your committee on the subject of the War Damage Corporation.

It is the request of the 28,500 local property insurance agents from coast to coast, who make up the membership of this national association, that the Congress promptly reactivate the War Damage Corporation of World War II. The success of the Corporation in the past was due to the farsightedness of the Congress in making use of the facilities of the private insurance companies and the local insurance agents of this country in a time of emergency.

Due primarily to the danger of a catastrophic atomic bombing, it is of the utmost importance, we believe, that in order to ultimately protect the emplovers of labor and labor itself, the Congress should also provide facilities within the War Damage Corporation for the purchase of catastrophe reinsurance for workmen's compensation coverages.

All of private industry, both insurance and otherwise, is unanimously behind the request for prompt action. It is our belief that prompt action by the Congress on this comparatively simple and non controversial reactivation of the WDC with reinsurance provisions will prevent needless delay which could result from the introduction of numerous side issues. These side issues would, of course, necessitate extensive study by your committee and needless delay to the basic WDC reactivation. The favorable action on this problem by your committee in the Eighty-first Congress is remembered and appreciated.

Sincerely yours,

MELVIN J. MILLER, President.

Re S. 114 and S. 439.

NATIONAL ASSOCIATION OF MUTUAL SAVINgs Banks,
New York, N. Y., April 16, 1951.

Hon. BURNET R. MAYBANK,

Chairman, Committee on Banking and Currency,

United States Senate, Washington, D. C.

DEAR SIR: On behalf of the National Association of Mutual Savings Banks, I desire to commend the principle of S. 114 and S. 439, and to urge the prompt enactment of one or the other of these bills.

The National Association of Mutual Savings Banks comprises 530 mutual savings banks throughout the United States. These banks are located in 17 States and have combined assets amounting to $22,531,000,000 of which $8,283,000,000 are invested in mortgages on improved real estate throughout the country. These assets constitute for the most part the life savings of 19,469,000 depositors amounting to total deposits of $20,049,000,000.

The trustees and officers of the banks have always endeavored to protect the interests of their depositors by attempting to secure, so far as possible, insurance of property of which they are mortgagees. Today we are faced with the possibility of sudden enemy attack on our major cities in which many of our member banks have large concentrations of the aforesaid mortgage investments. It is very possible that many of these mortgaged buildings could be destroyed as the result of one atomic bomb explosion.

At present there is no insurance available to indemnify a property owner against loss resulting from atomic explosion, insurrection, or enemy action, with or without a declaration of war. Such coverage should be made available, and in default of private insurance, for which no actuarial information is available, it is our belief that the United Sttaes Government should spread the risk, as was done in the last war. However, since the insurance is in the nature of a stand-by measure, we should prefer to see the law provide that in the event that no claims for loss have been paid by the end of the first year of operation, all policies then in force shall be continued for the succeeding year without additional premium charge. This would obviate the situation which arose during the last war, when premiums were collected despite the fact that no substantial losses were sustained. The urgency of the international situation is such that we cannot emphasize too greatly the need for prompt action. From December 6, 1941, to June 30, 1942, Congress provided interim coverage until such time as the War Damage Corporation was actually in operation. It is our recommendation that similar action be taken now with respect to the period from now until such time as the Corporation is again in operation. We urge again that the legislation be expedited. Very truly yours,

FREDERICK G. BAKER, Chairman, Committee on Insurance.

NATIONAL SAVINGS AND LOAN LEAGUE,
Washington, D. C., April 16, 1951.

Re bills to grant succession to the War Damage Corporation, S. 114, S. 439.
The Honorable BURNET R. MAYBANK,

Chairman, Senate Committee on Banking and Currency,

United States Senate, Washington, D. C.

DEAR SENATOR: Inasmuch as we approved, in the hearings before your committee on December 21, 1950, when the committee was considering H. R. 9802, the reactivation of the War Damage Corporation, I wish now merely to reaffirm for the new record on the subject matter our interest in seeing the War Damage Corporation reactivated. Our chief interest in this matter is the protection which we feel should be made available to home owners of the country against damage to their homes and contents which would not otherwise be covered by insurance.

While we have noted less active interest in the matter of war damage insurance in the last 3 or 4 months, we attribute that to the drifting condition of the international situation. Nevertheless we think it highly desirable that adequate wardamage insurance be made available and, therefore, continue to favor legislation which would grant succession to the War Damage Corporation

With kind personal regards.

Sincerely yours,

OSCAR R. KREUTZ,

Executive Manager.

Hon. BURNET R. MAYBANK,

STATE OF SOUTH CAROLINA CIVIL DEFENSE,
Columbia, April 13, 1951.

United States Senator, Washington, D. C.

DEAR BURNET: As civil-defense director of the State of South Carolina, I am interested in a number of bills which will be heard by the Subcommittee on Securities, Insurance, and Banking and which have to do with the provision of Federal insurance or reinsurance of personnel and property in the event of enemy attack on this country. I feel sure that I can count on you, as a member of this subcommittee and with your knowledge of this particular subject, to do what you think is right and just for the people and property owners of our country. With kind personal regards, I am

Sincerely yours,

JAMES C. DOZIER, Director.

PHOENIX-LONDON GROUP,

New York, N. Y., February 28, 1951.

Re compensation for employees injured from war hazards.
Hon. BURNET R. MAYBANK,

Chairman, Senate Banking and Currency Committee,
Senate Office Building, Washington, D. C.

SIR: We understand that there are two bills currently introduced, one in the Senate (S. 114) and one in the House (H. R. 1031) which will provide for reactivation of the War Damage Corporation.

The Senate version also provides for protection, through the medium of reinsurance, with respect to war-risk hazards resulting in injuries to employees of employers who are insured for workmen's compenation or who are self-insured. The House version goes a step further and provides for coverage with respect to injuries or death suffered by civilian-defense workers as a result of warlike action or attack by a foreign power.

In our opinion, some form of reinsurance protection for insurers and selfinsurers against war hazards is vitally important to the economic welfare of the country. The resources of private insurers and of self-insurers would be hopelessly inadequate to cope with the consequences of any widespread enemy attacks on this country. As a result of such an attack not only might it very well be that insurers would be thrown into insolvency through inability to meet the costs in terms of compensation benefits, but also vital industries forced to shut down through lack of insurance facilities. Equally disastrous would be the effect of such an attack with its consequential workmen's compensation losses on a selfinsurer engaged in a vital industry and forced to shut down because of lack of funds by reason of losses payable in the form of workmen's compensation for injuries or death suffered by his employees.

The most workable solution would be to authorize the War Damage Corporation to reinsure insurers and insure self-insurers against the hazards of war-risk injury. We urge that hearings be scheduled on this legislation at the earliest possible time so that a program can be formulated and appropriate legislation enacted as soon as possible.

Very truly yours,

W. E. LOWTHER, General Counsel.

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