East Oregonian : E.O. (Pendleton, OR) 1888-current, 1906-07-07
FIRE INSURANCE
AT LOWER RATES.
NORTHWESTERN MUTUAL OF Sc
ATTLE CUTS COSTS BY
10 FER CENT.
SAVES FORTUNES ON POLICIES.
Interesting Disclosures In Connection
With Demand of Board Concerns
For Higher Charges.

In the face Of the promise of e
board lire fire insurance companies
that Spokane would be favored soon
with reduction of rates, upon the
completion Of The water system, which
will be ready for operation July Is,
the statement of ]. ID. Coleman of
the Home Insurance company, that
the rates will be raised 20 per cent In
the next 80 days, comes as a disap-
pointing surprise TO the policy holders
in this city.
The crux of the company's conten-
rtion is that Spokane must come to lis
shane of the rescue of the companies
that were hard hit by the San Fran
cisco disaster. Otherwise. says Mr..
Coleman, receivers will be the MT
thing in order for the fire insurance
companies OF the oountry.
The contemplated advance In rates
OF 25 per cont will be a seeious prop
osition when 1t Is traced to the ulti-
mate. 1t Will, of course, hit every
home-owner. Insurance rates are al
ways figured by merchants as legiti-
mate fixed charges against the opena-
in insurance rates would mean al
added cost In ;the operation of the
mercantile business anu a correspond
ing rise In the price of merchandise
carried. More than this, It would
mean Increased cost Gf owning i'm
proved real estate. resulting in q sea-
son of high rents.
Cuts Board Rates 40 Per Cest.
As evidence of the profitableness If
carrying risks at far less than the
present rates the Northwestern Mu-
,tual Fire association of Seattle mas
entered this field with a promise of
saving its policy holders ~ per cent
of the board rate premiums. In q
circular letter, sent to large num-
ber OF prospective risks in this City,
the company states that II COLLECTS a
cash payment upon the delivery of the
policy equal TO one-hah the annual
boani rate. In six months tins COM
,pany will pay a cash dividend and
collect another semi-annua1 premium.
and SO on throughout the term of the
policy, which, to save expense Of re-
newal, IS issued for a term of fiTe
wears, with q pro rata cancellation
clause which may be used at any time.
How It Saves Money.
SFor example," the letter reads,
ION a policy of s1o.sO0, where the
board rate is 2 per cent, we would
charge you a cash payment Of $10S
and in six months you would receive
a dividend OF $40, and then make an
other seim-annual payment Of 800.
and SO on throughout the term of tho
policy. II the policy is cancelled at
the end OF six months 1t only costs
YOU $50, while ,ther companies would
charge you short rates, amounting to
$40"
Some inquiry has been made Of late
into the liability assumed by the
policy holder when he pays a cash
premium into mutual company. Ac-
cording to the Northwestern Mutual
Fire association, the policy holder as
sumes no liability whatever beyond
the payment Of the cash premium.
The company cites the opinion of the
attorney generals office upon the
subject. The portion Of the opinion
bearing upon that subject is as fol-
lows: when cash premiums are ac-
cebted and provided for by the trus-
tees Of such company, as provided by
law, the policy holder paying such
cash premiums is not liable for any
further payment in case of heavy
loss by the company"