The Brandon news. (Brandon, Miss.) 1892-1961, 1903-12-24
EXTRACT FROM THE ADDRESS Or
INSURANCE COMMISSIONER COLE
Before State Convention Of Business
Men at Jackson, Miss.

'.rhere is no department Of the State gov.
eminent Of more Importance to the people
than the insurance, unless 1t be the educa-
tional department., for more people are d.
rectly interested In insurance than In any
other business. 1t is a mistaken Idea that
only the person with property to insure Is
interested In fire insurance, and the rates
charged therefor Every fire destroys val
ues-takes that amount from the wealth
Of the country and generally from the as
sessment rolls Of State, County and Town,
thereby more or less affecting every citizen.
Besides, insurance has become an absolute
necessity to the business man, and its cost
enters as surely into the selling price OF his
goods and wares as do other taxes, rents,
clerk hire and transportation charges, thus
directly reaching his every customer. But
the facts are well known to this intelligent
body, and the thing to be determined here
Is what can be done to improve conditions
and rates In this state. 1 have been re-
quested to lead In discussing the topic,
Protection to Property From Fire Losses, y
and l want to say that when we have COR
rcctly solved this problem we will have
found the key to the whole situation and
low rate and every other desired better
ment will follow as certainly as effect fol-
lows cause.
The Cause of Fire.
The fire waste Of this country amounts
to more than 6O,OOO,000 per annum and
1t is known that more than 60 per cent OF
all fires start from preyentable causes
These two facts prove that the topic I'M
der discussion Is the most serious and i'm
portant one connected with the whole
question of fire Insurance. They also show
that the most necessary thing to be done
to protect property Is to learn the causes of
tres and remove as many Of them as posi-
| BILE.
Now, how can the public best learn the
causes OF fires and the means of reducing
them? Certainly not by individual expe-
rience, but through the combined experience
OF all the companies engaged In the busi-
ness, and not by this in our state alone,
but throughout the whole country. The
hundreds Of causes of fires can never be
known to the public In any other way than
through the insurance companies, because
this Information Is not gathered and COM
piled by any other statistical bureau ex-
cept that Of the fire insurance companies.
And even when such causes are known,
there Is nothing that Will so surely hasten
| their removal or correction as the certain
knowledge that failure to correct material
~ increases the rates Of premium charged,
not only on the faulty risk but on all
| others exposed to it. State laws and city
ordinances can not alone be depended upon
70 remedy faults OF construction, the accu-
mutation of combustible material in cellars
and back yards, defective electric wiring,
storing ashes in wooden receptaces and
The many other things which cause fires
that are daily done; for, in the first place,
there Is with us no standard for any OF
these things, and consequently a great di-
versity Of opinion exists as to what is
faulty construction, combustible material
Or defective wiring; and, In the second
place, the laws and ordinances are not
strictly and impartfally enforced. Insur-
ance companies have standards and rules
which must be complied with by the pub
lie that the assured may reap such bene-
hts as certainly accrue from compliance
herewith.
1T is, therefore, In the interest Of every
property owner that insurance companies be
allowed to inform us in the most effective
way just what their standards and rules
are. They should be permitted to freely
Interchange information, agree upon ques-
tons OF Improvement in construction and
In protection, and to publish for the infor.
nation OF each other and the public a
| schedule OF rates, just as railroad compa-
Gies do. BY this means the property own
er could see how his rate was computed
IN every case. He would see what de-
6ciencies he was penalized for and what
credit he would receive for improvement,
and the result would be that in the
great majority of cases improvement
would be promptly made. IL companies
were allowed to combine In the employ
ment Of experts to inspect. classify and rate
their risks they could reduce their losses
and expenses and thereby cheaper the cost
Of insurance to the public.
Anti-Compact Law.
Adequate and equitable rates, based
upon the merits and dement's OF each risk,
are In the interest of both the policy hold
Ell and the stakeholder. Without these the
burden Of insurance Is unequally distrfb.
hted and one mans property protected at
| the expense of another. One expert can
inspect and fix proper rates for all compa-
nies on any given risk in the same time
required to do this for any one Of them
II companies are allowed to cooperate all
could use one expert whereas, il each Is
compelled to perform this task for itself
C0e expense, OF course, ts increased CORE
spopdingly, and in the case of property
requiring the policies Of ten or more com
| pantes, a single company could not secure
correction, for 1t would require the coop
Grafton and influence of all interested. rake
for instance, our State Capitol; suppose i
Is desired to insure 1t for $5OO,OOO or more
and 1t would require ten or more companie.
| to write this sum, no one company being
willing to write more than $5O,O00, one ex
! pert could inspect and rate the risk in &C
/ cOrdance with the schedule and his rat,
would be accepted by all the companies OF
the risk. Under our present law no two
or more agents could agree on rate with
out violation Of our anti-compact law
thus forcing each company to inspect and
rate the risk independently Of each other
and an improvement that would secure %
reduction from one company might not be
considered by many others on the risk
This condition applied to Mr.. Rothenberg's
risk in Meridian and all others In this
state.
Credits for correction of faults which
cause fires would encourage proper con
struction; proper construction would pre-
vent the spread OF fires, and both would
tend toward the protection OF property
from fire losses and finally result in cheap
er insurance to all property owners. So
gentlemen. the cooperation OF insurance
i