The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1895-02-27

President Dutton of the Fireman's Fund
Company last evening, "and if we did en-
force it there would be no contempt of
court
1--WE are maintaining rates, being con-
vinced that it is not safe to cut rates below
profitable figures, and we find that many
of the best poIicy-holders downtown are
inclined to favor our conservative policy
The board took measures to Immediately
reduce rates on what is known as preferred
classes, composed of dwellings and other
more hazardous risks in sections where the
profit has been large, notably Oakland, San
Jose and similar places.
The Continental Insurance Company de-
lined its position with reference to the
Board OF Underwriters of the Pacific in a let
ter addressed to the president of that or
ganization, as follows:
We favor the fixing OF rates by associated
companies, provided they are not placed on q
basis that yields too high a percentage of
10 per cent, after a fair allowance for necessary
expenses We are willing to join any properly
organized association having for its object the
making and enforcing, preferably through
local boards, of correct rates and practices, but
we are not willing to be party to "boycotts, -
or as you term them, "non-intercourse" meas
ures.
We hold that the commission question is
best settled by having no rule as to what can
and cannot be paid, for such rules are violated
by those that are dishonest, and the honest
company is robbed. Where, however, other
companies entertaining different views form
separate organizations to control the commits
sion , question, it is not our policy to antagon-
inquiry OF Eastern underwriters.
Explanatory of this position we would say
pretty: II rates are properly made, each risk
being required to pay what it is worth, and no
class OF business rated so high as to yield an
undue profit, the incentive to pay excess COM
missions is done away with. If any class of
business is made to pay rates that will result in
undue profit excess commissions are sure to be
paid by some companies to the detriment of
others, and in the end the practice becomes
general.
You say you do not understand why we are
willing to cooperate and trust companies in
the matter OF enforcing rates, while we decline
to trust the same companies in the matter of
commissions.
Our experience shows us that rate agree
ments are better maintained than are commits
sion agreements. Local agents watch each
other and are jealous of rate cutting and re-
bate measures because it hurts them, but they
are perfectly willing to aid any company in
breaking the commission agreement because
that helps the agent. Again, ii we suffer from
an occasional cut in rate, the amount involved
is small and does not affect us to any extent,
Whlle the violation OF commission agreement
buys business in bulk and is seriously felt by
the company wronged
General average is the underlying principle
in in our business, and it applies to these qnes-
lions as well as to the line question, and il
there is occasional bad faith in the matter of
cnttlng a rate on an individual, risk, we can
stand IT, as the amount involved is small, but
when it comes to losing our important agency
connections by bad faith and the violation of
the commission agreement, the amount in
yolved is relatively large, and we desire to be
free to compete, knowing by experience that
under such conditions we will not suffer, be-
cause the company willing to pay the excess
commission viii know that we will meet the
offer, and nothing but harm will come from it; ;
therefore we favor free trade in the matter Of
commissions