The sun., 1909-01-24
Shy OF EAST SIDE POLICIES
FIRE INSURANCE MEN rrr
DOWN THEIR BUSINESS

|
In the last six months some twen,v.
Ave FIRE insurance companies doing bus
ness on the East Side have given up Doll.
cies on household elects taken out uf tha.
section. which amount, il s estimated
TO $4,000 100000. In July. lss
the number Of fire alarms reoeived Nv
Engine II, situated on Ludlow strao.
just south Of Delanoey street. was 10;
In November and December the calls wers
fifty-fve and eighty seven,
The policies which have been canoe,led
are entirely those taken out Tor sman
amounts on personal property by resi.
dents Of the section bounded roughly
by the Brooklyn Bridge Twenty-third
street. the Bowery and Third avenue and
the East River. But the companies ara
still eager TO insure buildings and stocks
Of the neighborhood.
The chattel policy has always been
looked on as bad risk by most companies
The favorite explanation among inslr.
ance men is that the policies are so closely
punched as a result Of the great conges.
ton in that quarter that one good hrs
in tenement will wipe out the profs
of months business. This is due TO ,hs
circumstance. among others, that tb.
| 80 per cent. clause is not enforced in hi.
State on policies Of less than 81, 500 Ths
80 per cent. clause provides that an az.
sured TO collect full damage must insure
his property TO so per cent of its full
value. Without this protection the com.
pany which insures for 500 a mans
effects worth. say. five times that. must
pay the assureds fire loss right up 10 the
$500 limit in full, and the companies have
been doing il on the East Side until they
are tired OF 1t.
Out Of a premium Of IS 1t Ia figured that
the agent gets commission Of tl2S
Seventy Ave cents more goes for expenses
Of administration. and normally the fire
loss eats up q more. leaving 81 clear for
the company. The minimum rate for
household effects in fiat houses through
out New York city except in Long Island
City, 10 20 cents on 500. On the East Side
il is about g. q hundred. The ordinary
fire loss Is estimated at 40 per cent Of the
premium. On the East Side il is never
less than twice that, and for some oom-
panies it is even four times more
number Of companies have found that
their profits from all their New York
city business just about pay the deficit
occasioned by the East Side fire losses
Other companies run behind.
One Of those which have discontinued
business over there did so after 1t dis
covered that it paid sixty or seventy
claims a month out OF a total Of two
hundred TO six hundred chattel policies
outstanding. Their fire losses we're 81 900
a month, which didn't quite equal their
gross receipts from that quarter.
These fire losses are mostly Occasioned
by little one alarm blazes which leave
only slight traces but which occur fire.
quently. In proof OF this one insurance
man pulled from his desk the 1907 ratio
tables compiled by Harrison Law, head
OF the loss department of the Southern
Insurance Company Of New Orleans,
The Ave year average chart showed that
the Continental. which doesn't do busl:
ness on the East Side. has fire loss Of
Al. per cent. while the Hamburg-B Bremen,
which does. has loss OF 65.l per cent,
the Home 49.9 per cent, the Hanoyd
53'4 Der cent, the Royal Exchange 5al
per cent and the Star Of Kentucky 81 per
cent. The San Francisco paid losses are
excluded from these tables
The insurance men attribute most Of
their losses to the business practices OF
some few public adjusters, however;
Whenever a man takes out chatlei
policy this type OF adjuster gets word
Of it from the broker. insurance men
say. Then il fire starts in dar closet
the adiuster offers his services on con-
tingent basis. 1t is thought that often.
times the assured magnifes his losses
considerably-ten times was the rauo
mentioned-and the adjuster is then SAID
to assign himself TO getting the face OF the
claim out Of the company. He does not
always fail. either.
Sometimes this type OF adJuster has
been caught in trickery. One insurance
man told Of public adjuster who posed
as an officer OF the insurance COMPANY
and offered to get a claim OF the assured
put through for half the proceeds An
other adjusteg was told plainly that ne
was likely to face a criminal prosecution
The adjuster dropped his suit agains
the company and settled claim Tor ~"
out of his own pocket. Sometimes u
is said, tailors lend helping hand 10
fattening fire loss claims. The instance
was recalled Of certain coat which Was
paid for three times on as many dlheren.
claims. One firm OF tailors on tne ras.
Side is said to profit by supplying afhdaNls
robe Of friend, -,
The companies have little or no legal
proof of wrongdoing. Nevertheless they
know enough to warrant them, ~
they think, in withdrawing, for tune a.
least. The first step was taken by arg
English company last fall An oincla'
from the other side in examining lhto
the management OF the American hrancn
ran over to the East Side to look into the
merits Of a fire claim for several hundreu
dollars He examined the room m the
tenement where the fire was said to nave
taken place. There wasn't even uaoo
Of smoke. -
Not much evidence" he remarked
obviously. .,.
oh it was explained to him, me
damage was by water. The pollcyho'ue'
lives underneath here -
The policyholder down stairs shoNeu
his damaged effects all right. but ne
couldn't show any water STAINS on W.
ceiling. Since then the English COMPANY
has got rid Of something like nniss tht@
quarters of a million OF small poIGne
on the East Side and the others have Tor
lowed suit, until about one-haIf OF une
chattel policies of that quarter have oecn
cancelled OF allowed TO lapse, .,
Engine II. situated on Ludlow suee'
near f,elarrcey. and Hook and lad--r -,
on Attorney street near Delancey, az az
known as the busiest fire houses 10 one ens
world The truck made 1876 rum, IN one
month last summer. which is said 10 "
the worlds record, while the engine was
called out 10 times in one day in Scptein.
ber OF 1907. The total runs made 10y dS' Wv
companies in 1907 was: Engine l., l'"'
Hook and Ladder ls, LOSS z;,cs
They haven't been no busy liz mi,S
the underwriters have been canceIls
policies. Here is the record of alarms
received by the engine house for the yea