The San Francisco call., 1908-04-26
SAYS INSURANCE
. COMPA CHEATED
Suit Charging Fraud Is Filed
Against the American OF
Philadelphia
Fifty Per Cent Settlement IS
Said to Have Been Made
on Misrepresentation


Charges that the American fire IN
surance company of Philadelphia en-
tered into "a corrupt and frauouieht
contract with the Commercial onion
assurance company of London IN OF
der to effect a SO per; cent settlemen'
basis with policy holders whose prop-
critics in this city were destroyed py
the fire in 1906 are made IN com,
plaint filed against the sCommefcial.
Union assurance company YESTERDAY
With the county, clerk.
The action is taken by the Polley
holders adjustment company IN De
half of the Williams Marvin company
of this city, which held a ciainl'
against the American fire insurance
company amounting to $4,000, nut
was induced to accept $1,000.
Suit against the Commercial Union
assurance follows in the wake OF an
alluringly worded circular letter ls-s
sued by the American fire insurance
company and advertisements In news;
papers in which the company sets'
forth that after. having been forced TO
retire from business by reason of hav-
ing honorahly disposed of all the
claims arising out of the San Fran
cisco disaster to the best of the COM
pany's abilities. the company is again
in the. field for the purpose of writ.
ing a conservative business and to
pay therefore a commission or moi,
more than Is per cent.
The circular makes the assertion
that the American company stock
holders have come forward and paid
up its capital stock to s200.o00,. and
points with pride to a statement
based upon an examination by the
Pennsylvania insurance department..
The latter places the cash. capital sof
the American company al 100000; la
bilities, $215116.9s assets, S451. .664,
and surplus to policy holders. s2s4,-
54T.04.
Immediately after the adjustment
of several claims by policy holders of
this city the American company de-
clared itself insolyents and bankrupt
beyond al! hope, and denied being
able to settle on a larger basis than
SO per cent.
According to the complaint the
Commercial Union company .reinsured
all the risks of the American COM
.pany. except the perpetual policies and
took over the assets of the latter,
which aggregated s1,44S,316 This
action reduced the assets of the Amer
lean company so that it could not pay
more than 59h per cent on the claims.
The Policy holders adjustment COM
pany claims such action was taken
without adequate consideration and
asks an annulment of the contract
and that the assets of the Commercial
Union company be retransferred to the
American company, to be divided
among the Williams Marvin company
and the other claimants of the Amer
lean company
separate suit was also filed in be-
half of the American company, which
organization, IT Is claimed, originally
held a claim Of $56.S91.19, but was in
duced to settle upon the receipt of
s25.445.59.
tenn there can be no assurance of ac-
curacy, as 1t is well known that the
marked or stenciled weights vary fire.
quently several hundred pounds. The
result Of this is going to show in
the increased number OF claims for
overcharge of weight
George w. Colby of the Great North
ern has received advices that the line
between Great Falls and Helena, Mont,
which was recently washed out by the
bursting of a dam on the Missouri river
has been restored and the road opened
to traffic.
Virgil G. Bogue, chief engineer of
the Western Pacific. is making an in
spection of the road north of Sacra-
mento.
B. F. Stoll Haight st at Masonic ay =