Boston. 2d Feby.1797.
I hasten to acknowledge my sense of your politeness in transmitting the very valuable official paper contained in your letter, and of your condescension, in intimating, that any information within my capacity to collect could be of any worth to you. If this attention, as unexpected as it was unmerited, should fail of drawing from me any valuable fact, I hope, Sir, you will not regret your pains as wholly fruitless. One source of satisfaction you will still possess, in the reflection, that by this notice, you have multiplied my motives to duty, and stimulated the principle of exertion by the flattering idea, that a remark of mine could be, possibly, of some little consequence.
I am not yet fully apprised of the “sensation” and “reflections” occasioned by Mr. Pickerings letter. Not many copies have reached us. And our daily prints have presented the public with only a partial view of it. To the few, who have considered it, with whom, I have had opportunity to converse its facts appear satisfactory and its reasoning conclusive. They also seem gratified by the manner, in which the Secretary has vindicated the character of our government and the feelings of our nation. Any considerable impression on the public mind, from this communication cannot, however, I think, be expected. The subject has been long under its contemplation. Most of the ideas of Mr. Pickering have been suggested to it in some view or other. Scope was left but for little novelty in fact, and, perhaps none, in argument. And the sole effect, I presume, reasonably to be looked for, is, in the minds of judicious, reflecting men, to establish, by official documents, facts, which they had credited before, on less respectable authority, and, by a compact view of reasonings to confirm opinions, they had already embraced on such, as were more loose and desultory.
Respecting “the effect this whole business has had or shall have on our Insurance offices and the price of stocks” I have made such general inquiries as might at once secure accurate information, without inducing suspicion of particular destination of it. As it is a subject, in which I am not professionally versed you will pardon any want of selection or pertinency in my remarks. The business of Insuring being here carried on, by private bodies of men, is necessarily subject much more to caprice and passion & much less to principle, than it is in those places, (such as, I am informed, is Philadelphia) where single corporations regulate, & monopolize the right of Insurance. We have here, no less than four Insurance offices. Each of them subject not only to the varying humour of individual underwriters, but, in some, & I suspect, in no small degree, influenced by political zeal and motives. In conversation with One or two principal Underwriters of an office alledged to be in the opposition Interest they asserted “that risques to British West India Isles could not be insured against for any præmium, at least not under 70 perCent advance perhaps an 100”. This however was the language of men, well disposed, at least, to encourage the idea of a French war, and not an opinion resulting from any investigation of danger or calculation of Chances. The truth after an inquiry, as accurate, as the nature of the subject and the particular situation of it, in this place, admits, appears to me, to be this. On all European risques, the rates of præmium are not much augmented by the present hostile relation of France to this country. Yet a præmium of One perCent upon an out & home voyage may be stated as an Average advance, resulting, not from any definite fears of the mercantile Interest, but that alarms of this kind however trivial, will always naturally produce, in the assured, readiness to pay, and afford to the underwriter reasons to require, an increased compensation. But as to West India risques the case is very different. Præmiums are considerably augmented. And this increase is fairly attributable to the letters of Mr. Adet, to late depredations of French Cruisers and to the general aspect of affairs between France and the United States. Instating this advance it is almost impossible to name any particular sum as its standard. Since the fluctuation is in various degrees, not only from the causes before mentioned but also from the particular nature & destination of the voyage.—As whether, out or home, or both; or to the Leeward or Windward Islands—All which considerations materially alter the præmiums according as they increase or diminish the risque of Capture by French Privateers. The only method I can conceive to ascertain satisfactorily what advance may be charged justly to the account of the French business is to compare the relation of Præmiums to British & French West India Islands as it existed, antecedent to this interference, with their present relation to one another. Before the publication of Adets letters the rate of Præmiums to British and French West India Islands, (not blockaded) all other risques being equal, was the same. It is agreed by all the Underwriters that at present the difference is as 10. to 14. or 15—or as 7 1/2 to 12. That is, Præmiums to French Isles remain the same, while an increased preæmium is now demanded to the British, never less than 3. and, as yet never more than 5 perCent.
As I before intimated, this rise of Insurance, appears to me, not attributable to any general sentiment pervading the mercantile Interest or any other description of Citizens that a war between France and America is a thing probable. On the Contrary very little fear seems to exist on this subject. The true reason may be found in the encouragement the communications of Adet have given to the piratical temper of the French Islanders, the readiness, which they have already exhibited to profit by the hint of the minister, as well as the certainty that all retribution is hopeless for any property their Cruisers may share. To confirm this idea, “stocks” which, an anticipation of any permanent national embarassment, would inevitably indicate the public sentiment have experienced no alteration. Men conversant in the funds of assure me, they have for these three months, undergone no other variation in value than such as may be accounted for fairly, on the score of private necessities.
I hope your goodness will pardon this tresspass on your patience; And will not attribute my prolixity, to the vanity, that, in my opinion, a remark of mine could be of value to you, but solely to its true motive.—That by strict obedience to the wishes, you had the condescension to express I might have an opportunity more fully to evidence the very great sincerity and respect with which I am, Sir,
Your most Obedt & humble Servt.
MHi: Adams Papers.