The Montgomery advertiser. [volume] (Montgomery, Ala.) 1885-1982, 1904-07-18
ON INSURANCE RATES
INSURANCE COMMITTEE WRITES
THE CITY COUNCIL.
Gives to the Council the Results of It's
Negotiations With Southeastern
Tariff Association for
Lower Rates.

The Insurance Committee of the
Commercial and Industrial Association
has addressed a letter to the City
Council giving the results of the Com
mittee's investigation of insurance
rates.
| The letters gives the result of the
Committees negotiations with the Ex-
ecutive Committee of the Southeastern
Tariff Association. 1t is sent to the
Council to give the members full in
formation of the work done for lower
insurance rates for Montgomery.
| The matter is not a new one to the
Council. The Aldermen have discussed
the question before. The Council and
the Southeastern Tariff Association
have been unable to get together in
agreeing on what improvements should
be made in the fire department to get
re- rating for Montgomery.
| Some of the Aldermen have expressed
doubts as to the sincerity of the South
eastern Tariff Association. The mat
ter is still an open question In the
Council. The Committees letter in
full is as follows:
City Council of Montgomery. Montgom-
cry. Ala:
Gentlemen-Pending the expenditure
by your honorable body of funds for
the improvement of the water supply
and fire department of the city. we
wish to direct your attention to the
result of negotiations had with the
Executive Committee of the Southeast
ern Tariff Association at Atlanta.
Upon learning that a misunderstood
Ing had arisen as to former correspond
ence. a subcommittee went to Atlanta
In company with subcommittee from
the local board of underwriters of this
city. For two hours the Montgomery
situation was discussed with the mem
bers of the Executive Committee of the
Tariff Association, and at last the fol-
lowing proposition in writing was OBJ
tanned:
First-(a) If Montgomery will pro-
vide one additional steamer of the first
class and locate same at headquarters;
(cost $4,000. OBJ Provide one chemi-
cal engine (cost $4,000; (c) Provide
one additional hydrant to each block in
the business section, each to be two
way, six inch, with four and one half
inch steamer connection, located so as
to secure equal distribution, consider
ing hydrants already installed, in ac-
cordance with plat submitted (cost 23
hydrants. $1.650) then the basic rate of
insurance for Montgomery will be re-
duced from Its present figure of $.S5
ten points,. e. to $.75. The Commit
tee estimates the original expense of
these improvements to be $4,000. The
annual insurance premiums of Mont
gomery amount to over 100000, the
average rate being about per cent. A
reduction of ten points. therefore means
! a saving of $4,000 annually to the peo-
pie of Montgomery by. an investment of
$4,000.
Second. If, In addition to the above.
Montgomery will provide an additional
fire pump of five million gallons
capacity every "a hours to be located at
the present pumping station at the
Water Works. then the basic rate of
the city will be reduced another ten
points lie. to SOS. The Committee
estimates this expense at about
$4,000. The further saving to the
people of Montgomery will be another
$4,000 annually.
Montgomery with these improve
ments. will then receive the rating of
a first-class plus 10 cents for excessive
taxation. The license tax of $500 now
charged the ffty-four Fire Insurance
Companies doing business In Mont
gomery is higher than in any
other city in the United States,
and the Insurance Companies nat
urally collect 1t back from
the citizens of Montgomery by adding
Is points to the rate which might 9TH
erwise be made. They pay about
$21, 900 into the city treasury in IL
censes, and collect back from the
people about SIS, 900 in excessive rates.
The committee believes that the So
luton of this license problem lies in
charging each company a more rea-
sonable fiat rate. plus a per centage
tax upon premiums annually written,
thus enabling the smallest companies
to come in and compete for business,
and at the same time compelling the
big companies to pay in proportion to
the amount of business written. In
this manner from $4,000 to $4,000 in
licenses could be collected from the
Insurance Companies, without the
City being penalized therefor in high
err insurance rates.
= These improvements are all needed
from a fire protection standpoint. how
ever. entirely Independent of any re-
duction in the rate of insurance. but
at the same time, If the City's money
Is expended in line with suggestions
above outlined, the community will
not only get a much needed protection
to property, but also substantial
saving annually in tn" cost of insu-
rance to each individual
The committee desirea to lay this in
formation before you TO aid your DELHI
erations in the purchase of additional
fire equipment and in making the i'm
provements contemplated in the water
supply of the city.
Very respectfully.
Insurance Committee Commercial and
Industrial Association,
c. P. Anderson. Chairman; C. w.
Buckley. Vice-Chairman; B. j. Baldwin;
n II Rrouun CiaueirnuS