The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1883-11-15
THE INSURANCE COMPACT.

surance business in Indianapolis. There has
called the 'board" and ''non-board" COM
panies. The board companies comprise, as
rule, the leading and the largest insurance
companies of the world which are associated
think are rates demanded to make the bust
ness of insurance sufficiently profitable to
the COM anies to render the indemnity good
to the,insured. The "non-board" companies
are those which decline to go into such an
association, preferring to work indie
pendently and directly with their
agents and customers The old plan for
the board" companies was an associa-
ton of agents in given locality, with
an executive agent to fix rates upon risks
after personal survey and an inspection of
the various features; but ne was under the
control of the representatives of the sevo
companies who generally we~7 rAd are men
of the highest busir -.,tegrity and ability,
thoroughly ersant with the city, known
r cir customers, with their interests at
heart as well as the interests of the compa-
MES of which they are the agents. Under
this arrangement there was very lit
tie friction, although now and then
there was disagreement out of which
the "non-board" companies succeeded in
securing at ali times fair amount of bust
ness. But as a rule, the "board' plan
worked WELL, until, in the lapse of time,
there was likely to come an undue assertion
on the part of the companies in the matter
of rates, or something else, when the whole
association was in imminent danger of going
to pieces, and finally did go, the result being
such cutting of rates as speedily demon
allied the whole business, and compelled the
companies to seek remedy. Years of heavy
losses followed; companies could not pay
dividends; not a few suspended and failed,
when the present system-"a compact" so
called-was inaugurated and in
stead of an association of local
agents, the companies by their general Off
GERS, entered into an iron-clad agreement
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juster, whose authority is absolute over the
matter of rates, the local agents having moth
ing more to do than to solicit risks and
write them, if they can, at the rates arbitrarily
made by the agent of the compact. In In
dianapolis this agent is Mr.. Ashbrook, gen.
tleman thoroughly versed in insurance, as
we understand, but an entire stranger to our
people and to the city, save what he has
learned since his residence here. We have
heard for some time of ill-teelng de-
veloped from what appears, to those
who think they know and are interested,
the unwise, ILL judged and arbitrary manner in
which Mr., Ashbrook has exercised his author
ity. 1t must be very evident that the intro
duction of such an alien and autocratic sys-
tenn of doing business would in the very
nature of things awake antagonism, and that
to make it a success its methods would have
to be applied with caution and fair regard
for local interests and prejudices. That this
has not been done here in all cases is noto-
rious among both agents of the companies
and the insured, and in not few instances
no little ill-feeling has been engendered.
Rates have been raised in some instances
without word of explanation or apparent
reason, and in Others Determinations have
been made which, to put it mildly, seem
absurd to men of certainly much larger in
surance experience that Mr.. Ashbrook, and
h. i
the ratio of hazard between specified risks.
This has brought about bad feeling in the
insurance business, particularly among the
business men and manufacturers who seek
indemnity at the hands of the companies
represented by the compact" In other
places than Indianapolis the revolt has been
so open and widespread that the compact
has been shattered and the business relegated
to the ''cut and slash" method, which is as
fatal to the best interests of the policy holder
as it is TO the companies
All intelligent people know that fair rates
must be maintained to secure good insur-
ance. The lowest rate indemnity is by no
means necessarily the cheapest. 1t may be
vastly the dearest and possibly worth
nothing at all. But our own people also
know that Indianapolis is a profitable city
for the insurance companies, always has
been, and it is hard to convince them why
there should be an arbitrary and unexplained
raising of rates. and fanciful and ill-judged
determinations in the classification of risks
They cannot understand why body of men
such as are engaged in the insurance
business in indianapolis cannot satisfac-
torily do the business of the city, as
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