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LITIGATION UNDER THE ACCIDENT INSURANCE LAW DURING 1906 AND 1907.
[Source: Bollettino di Notizie sul Credito e sulla Previdenza, 1908, Vol. XXVI.)
Kind of fund or association and classi
Pendfication of courts.
Aban- Dejudi- pro
judi- procated. mised
doned cemcated. mised
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ber 31. 1907.
Of the 6,916 cases, 2,431 were pending, so that only 4,485 were settled in or out of court. Of these, 561, or 12.5 per cent, were abandoned, 2,113, or 47.1 per cent, were compromised out of court, and only 1,811, or 40.4 per cent, were adjudicated in court. The number of cases disposed of by the various insurance institutions reaches nearly 150,000. For the National Accident Insurance Institution and the private insurance companies, the report gives the following comparison for 1906, the figures for 1907 not being available at the time.
DISPOSITION OF CASES OF LITIGATION IN THE NATIONAL ACCIDENT INSURANCE INSTITUTION AS COMPARED WITH PRIVATE INSURANCE COMPANIES, 1906.
(Source: Bollettino di Notizie sul Credito e sulla Previdenza, 1908, Vol. XXVI.]
It appears from this comparison that of the cases insured in the National Accident Insurance Institution, nearly 15 cases per thousand led to litigation, while for the private insurance companies the proportion is less than 7 per thousand. It is explained in the official report, however, that this difference against the national institution is not due to any tendency of this institution to put difficulties in the way of paying compensation and to call forth litigation, but to the fact that private insurance companies may scrutinize the requests for accident insurance and decline the risks, while the national insurance institution is prohibited from declining any application for insurance, and therefore gets the worst insurance contracts.
THE NATIONAL ACCIDENT INSURANCE INSTITUTION.
Among the institutions provided for accident insurance the most important is the National Institution for Insurance of Workmen against Industrial Accidents (Cassa Nazionale d'Assicurazione per gť Infortuni degli Operai sul Lavoro), not only because of its close official relations with the Government, making it practically a state institution, and because of the large amount of accident insurance it carries, but also because of its history and the rôle it played in the development of the idea of accident insurance. Italy joined the list of countries with compulsory accident insurance in 1898, after a long and obstinate opposition, which lasted nearly 20 years. During all this time Italy was making an effort to solve the problem through the method of voluntary insurance, and because the establishment of this system did not change the legal status of employers' liability, no objections were raised to the bill to establish a national insurance institution for the voluntary insurance of workmen against accidents, which was offered by the Government to the Parliament on the same day (in 1883) that the first bill for a system of compensation was introduced.
For 15 years (1883 to 1898) this system of voluntary insurance operated before the law for compulsory insurance was finally passed, and while the voluntary system was admitted to be insufficient, the volume of the operations under this system was constantly growing. In the system of compulsory insurance, as introduced by the law of 1898, this national insurance institution was given a prominent function, but its operation under the new law has radically changed in so many important respects that the history of this institution is divided by the law of 1898 into two well-defined periods.
The National Accident Insurance Institution is a private institution, organized by ten private savings and banking institutions, (a) which on February 8, 1883, concluded an agreement with the minister of agriculture, industry, and commerce. This agreement was approved by the law of July 8, 1883. The law granted to this private institution certain privileges, such as the free cooperation of the postal savings banks in all its financial transactions, the exemption of all its transactions from stamp duties and other taxes, and the exemption of the institution from the provisions of the Commercial Code concerning commercial corporations. The system of voluntary insurance against accidents as it existed until the law of March 17, 1898, went into effect, was established by this agreement and the following acts: The law of December 3, 1886, and royal decrees of March 26, 1884 (approving the rates), July 3, 1884 (approving the constitution and by-laws), July 24, 1887, November 22, 1888, and December 29, 1888 (approving the revised by-laws). O)
The institution was left its autonomous administration, though put under government control. It was self-supporting, that is, no subsidy from the Government was granted. Its income was derived mainly from the insurance premiums, and in addition from interest on investments, and from other miscellaneous sources. The endowment funds, however, were large, and therefore presented a substantial aid to those who wished to undertake the insurance of employees. As such insurance was entirely voluntary, it follows that the establishment of this institution did not introduce any change in
a The institutions were as follows: The savings banks of Milan, Turin, Bologna, Rome, Venice, Cagliari, the banks of Naples and of Sicily, the loan savings bank of Genoa, and the loan company at Siena. The Milan institution contributed 600,000 lire ($115,800) (which was subsequently increased to 625,000 lire ($120,625)), the Naples bank 200,000 lire ($38,600), the banks at Turin, Bologna, Siena, Rome, and Sicily 100,000 lire ($19,300) each, the Genoa bank 75,000 lire ($14,475), and the banks of Venice and Cagliari 50,000 lire ($9,650) each.
Bollettino di Notizie sul Credito e sulla Previdenza, 1884. Also Maurice Bellom, Les Lois d'Assurance Ouvrière a l'Étranger. II. Assurance Contre les Accidents. Troisième partie, pages 1653–1700.
the legal relations of the employers and employees, and put no financial obligations upon the industries except as the employer was willing to insure his employees at his own expense.
The insurance institution was organized in recognition of the necessity of some provision for the victims of industrial accidents, as well as of the advantages of an orderly adjustment of claims over protracted judicial procedures. Notwithstanding the recognition of the advantages of insurance, the obligatory system was claimed to be ill adapted to Italian conditions, because the burden of such insurance was excessive in view of the weak position of Italian industry, and because the compulsion was out of harmony with Italian conditions. Therefore it was reasoned that the development of voluntary insurance was more desirable, and for this development the national institution was to be a most efficient stimulus. There had existed some private accident insurance even before the institution was organized; but it was costly and therefore not popular. The national institution was able to quote very low premium rates for three reasons: The absence of a profit motive in its organization by the ten savings banks, which are institutions for social welfare; the low cost of administration, and the material advantages arising from the guarantee fund and the privileges offered by the Government. The premium rates of the National Accident Insurance Institution were very much lower than those quoted by private insurance companies, the latter in some cases being 300 or 400 per cent higher.(a) It thus not only offered a very cheap form of insurance but was to act as a factor in forcing the private companies to reduce their rates.
The National Accident Insurance Institution began its operations on a very small scale, but grew rapidly during the earlier years. In 1884 the number of insured was less than 500; in 1886, over 30,000; and in 1890 over 100,000. In 1897, on the eve of the adoption of the compulsory accident insurance law, the total number of insured was 172,869.
PRESENT PURPOSE AND SCOPE.
The original legislation concerning the national institution still remains in force, and only new regulations concerning premiums and indemnity were issued in 1898 and 1993 to conform with the requirements of the new law. The institution provides accident insurance to all who apply for it. According to the law of 1904, it must accept all insurance and even all reinsurance--offered, though it may increase the premiums when the insurance asked presents a special risk. The law further provides that establishments operated by the state,
a Avantage du libre choix de l'assureur-Congrès International des Accidents du Travail et des Assurances Sociales. Troisième Session, Milan, 1894.
Tome 1, pages 865 to 881.
provincial, and communal governments, or by private persons by franchise from the Government, must insure their employees in the national institution.
As far as obligatory insurance is concerned, the general provisions of the accident insurance law apply. Voluntary insurance against accidents may be contracted for by any industrial or agricultural establishment in the country.
According to the decree of November 22, 1888, all workmen who reside within the Kingdom and who have reached the age of 9 years may be insured. According to the agreement of 1883 the minimum age was 10 years. The blind, deaf, mute, epileptic, and insane are excluded, as a rule, though the executive committee may permit the insurance of deaf, mute, or blind. Epileptics may be insured only in the collective form and persons over 70 years of age only in the individual form.
From the beginning of the operations of the national insurance institution it has insured against the results of industrial accidents, namely, death, total or partial permanent disability, and temporary disability. Each insurance policy may or may not include the latter, separate schedules of rates being provided for insurance which includes temporary disability benefits.
As the whole organization of the national insurance institution for the first 15 years of its existence was based upon the principle of voluntary insurance, no fixed amounts of compensation could be established, the determination of the amounts being left to individual contracts and depending upon the insurance premium paid, as explained in a later section.
The following stipulations were made in regard to the payment of compensation. In case of death, the whole amount of insurance was paid to the legal heirs. Of permanent disability, three degrees were recognized. First degree: Total permanent disability, including the loss of both eyes, both arms, both hands, both feet, one arm and one hand, one hand and one foot, or incurable mental disease. For such disability the payment of the full amount of insurance was granted. Second degree: Permanent disability, reducing the earning capacity one-half or more, including such injuries as the loss of one arm or hand or one leg or foot, or such mental disease as does not altogether disqualify the person from employment. Third degree: When the injury is not as serious as in the preceding degrees, but yet leads to permanent diminution of earning power, such as loss of one eye, or one or several fingers. For injuries leading to disability of the second or third degree from 10 to 80 per cent of the total amount of insurance was paid. Indemnities for permanent disability or