The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1909-01-19
P. b. McGregor of Chicago,
Fire Insurance Expert,
Makes Interesting Address
Before Small Meeting.
ARE NO RESTRICTIONS
IN MUTUAL COMPANIES
Speaker States That Too Off,
en- These Concerns Are
Built on Sand and Are
Founded Without Capital.

Fire insurance companies do not
want higher rates. They want lower
rates, but want improvement in your
risks" That was one of the state
ments of P. D. McGregor, of Chicago,
in his address to the members of the
club last evening. His
was regarded as somewhat
The attendance was not
as large as had been hoped for by the
club officials. The gathering was rep
resentative of the insurance agencies
of the city, but the business men were
conspicuously absent.
Change Contemplated.
Mr.. McGregor is a representative of
the stock line insurance companies
and came to Richmond to set forth
the claims of this kind of companies.
A week previous. the commercial club
heard a presentation of the claims Of
the mutual companies. A change in
the insurance system in this city is
contemplated a1bl the merchants had
been desirous to hear statements
from mutual and stock companies be.
fore selecting which should receive
their patronage.
w. X. Bradbury acted as presiding
officer at the meeting, In introducing
Mr.. McGregor, Mr.. Bradbury said are
insurance is good deal like shoes.
But one buys shoes oftener and pays
less attention to insurance than he
does his shoes. The. quality is made
a point of consideration when shoes
are to be purchased, because they are
for wear, but the insurance policy is
for looks and so is laid on the shelf.
Sailors Were Responsible.
The origin of fire insurance was at
tributed to the old sailing masters,
whose vessels toured the Adriatic sea.
The ships were small and subject to
storms. so the owners formed a COM
pany and all paid In when one vessel
was lost. Later the storm risk was
not the only one and fire was one of
the next elements to be considered.
This pass the hat system was mutual
pure and simple and the mutual has
not changed much since, declared the
speaker. Continuing Mr.. McGregor
said:
Life Insurance Different.
"The rates charged is what provided
the greatest interest. The making of
fire insurance rates is not as simple as
it might seem. 1t differs from life in
surance in many ways. Mortality ia,
bles show the average length Of q
mans life and the insurance compan-
show how many fires there will be,
however, nor do they show many busi-
nesses that are destroyed will be in
sured In any one company. The fire
insurance companies have nothing but
previous experience to base their cal
culations on. The rates are determin-
ed in the effort to make each person
pay his share. There is a continual
fluctuation in conditions that effect
risks. Poor electric wiring has been
found to be one Of the chief causes OF
fires.
1.-The rates are arrived at In sci.
entific manner. The hazard is meas
ured by the conditions. When a basic
rate is fixed for city everything is
considered. In the states of most re.
strictive legislation, the rates are the
highest. Missouri intends to repeal its
restrictive laws. The expenses of the
average stock company are about sc
to local agents and taxes to be consid.
cred.
Liability Too Large.
When one takes a policy in a mu-
tual company he helps bear the loss OF
all others and all others help bear his
loss. The mutual is without restric-
tions. so the liability is too large. Il
the losses run large and some members
decline to accept their share. then
others have to pay additional assess
ments. Too often the companies arr
without capital. They build theil
houses on sand. The assessments art
not fair and about fifty mutual com
panies have failed in the past ter
years. Then there is no reserve fund
and the policy holder may md himself
unprotected. The reserve adds strength
and safety"
Following Mr.. McGregor. John w
Waters, secretary and treasurer OF the
vehicle and Implement Mutual Insur
ance company OF Indianapolis took NJ
the points advanced by the previous
speaker. An interesting argument 1Dl
lowed.