The Nation Foots the Bill

The greatest insurance blanket of all time was dramatically unrolled by Winston Churchill last week in the House of Commons. Ticketed as The War Damage Bill, this measure was estimated to blanket some $30 billions worth of British buildings with insurance, for which the owners would pay compulsory premiums of $800 millions in the next five years. The bill would authorize the Treasury in an emergency to pay another $800 millions into the "premium pool" which the Government thus set last week provisionally at $1,600 millions. If the grand total of war damage to British buildings turns out to be still greater than this, then under the War Damage Bill property owners will compulsorily make up half the outstanding sum and the Treasury will foot the other half of the bill.

The bill was based on property-damage statistics which Britain still had to keep secret last week, but Blitz death figures were available, significant. These add up to the fact that, taking the British life-insurance business as a whole, the extra risk which the Blitz has imposed on underwriting firms thus far is an additional burden of less than one quarter of one per cent. Of the 47,000,000 people in the United Kingdom, the Fuehrer's assaults had killed up to Oct. 31 only 14,700. Accordingly, Winston Churchill last week proposed no immediate Government venture in blanket wartime life insurance, although it was rumored in Whitehall that Treasury civil servants are working up a draft of such a bill.

The chief provisions of the property-damage bill on which the House last week set to work: 1) coverage will be retroactive to the date Britain declared war on Germany, Sept. 3, 1939; 2) owners of dwellings will pay compulsory insurance premiums equal to 10% of the assessed rental* value of the property; 3) business assets, plant and machinery will bear a compulsory premium of 1 1/2% of their value; 4) churches and chapels will be insured free, the Treasury paying all premiums. In addition, the War Damage Bill provides that any Briton may voluntarily insure under the scheme one motorcar worth up to $2,000 and additional personal property worth up to $6,000 upon payment of a premium of 1 1/2%.

Of the entire British wartime insurance setup (which already includes Government participation in insurance of all shipping) as it stands today, The Economist of London commented with satisfaction: "As with all other problems of wartime finance, it is wrong to think of compensation for damaged property as a liability that 'the State' . . . can assume or not as it chooses. In wartime the State is the community and the community is the State. . . . The only question is whether [the loss] shall be shared equitably or inequitably. The decision has now been taken to share it equitably."

In short the Government--i.e., the people--will foot most of the bill for property damage done by Hitler. However, so far as possible, it will try to postpone payments till after the war, then settle up and start a building boom to relieve postwar unemployment.

*British rates (taxes) on such property are traditionally assessed on rental value.

This file is automatically generated by a robot program, so reader's discretion is required.