The Fargo forum and daily republican. [volume] (Fargo, N.D.) 1894-1957, 1913-12-06

eign countries. All these efforts seem
to be along the right direction, but
you may lecture, send out literature
until doomsday to little avail, If the
companies continue to place their
policies in the hands Of ignorant and
unframed agents. Competition has
extended to such an extent that com
panies do all they can to keep their
agents sending in more premiums,
not caring upon what kind Of property
or what kind Of moral Or physical
hazards. so long as a good fat check
comes in at the end of each month.
Not long ago an agent in a small town
in my state was ordered by his COM
pany to cancel a risk. He replied
that he would do so as soon as he
could find the policy, and notified the
company that If they did not come and
get their supplies by a certain date
that he would burn them UP. This
agent represents a number Of leading
companies. What chance does a COM
pany stand in the hands Of this sort
of an agent? And yet by their scram-
BILE for representation, the companies
must put up with almost any kind of
treatment If they are to receive a few
more premiums.
Too Many Companies.
There are too many fire insurance
companies now engaged in the bust
ness. Their great number, to which is
added the ever increasing annex, If
continued will bring the business to a
chaotic state, weaken many of the
companies themselves, and by excess
siVe competition reduce rates to such
a point that no company will be able
to make a. profit; then will the public
show distrust, weakened companies
Tail or reinsure, q general reorganiza-
ton take place, and then may we hope
to see the number OF local agents re-
duced, h general quality raised, and
the business put upon a safe and sane
basis.
Preparation involves Much Expense.
Local fire insurance agents every
where are held responsible for their
acts; both by the companies they rep
resent and by their customers. In
every public address made upon the
subject Of the local agent we are told
that to them the public must look for
proper protection. They must so
draft their policy forms that their
customers may be fully protected in
case OF a loss; they must look after
rates and the standing of their COM
panles. To prepare an agent to meet
all these responsibilities takes time
n involves much expense. When an
agent has so prepared himself, he oc-
cuples a ~semi-public position and no
competitors should be
permitted to engage in the business.
Much complaint that has been recent
~ made in the press concerning over
insurance has arisen solely from over
competition among agents and brok-
ers. II a good agent refuses to add to
an already fully insured risk, the GUS
toner Immediately goes to some in
competent agent or broker and Sc
cures all the insurance he wants. BY
this means. frequently, a moral hazard
Is produced, thus making the incen-
tive to fire loss much greater, and
When the fire another percent
age Is added unnecessarily to the al
ead burdensome loss ratio.
Note of Warning to Companies.
All writer's. thinkers and public
speakers upon the subject Of local
agents agree that the multiplying of
the number Of agents produces dissen-
sion, unfriendliness, and distrust,
leading to bad practices in their at
tempt to keep up premium receipts,
and unless in some maner curbed. will
produce results that will be difficult
TO improve. Without seeming to con-
tlluaIIy repeat what L have said be-
tore, / want to sound a note of warn
ing to the companies, that unless this
multiplying Of the number of agents
coasts, they will find the competition
Will SO reduce their premium income
by reduction in rates, hat it will be
a real menace not easily chang
ed.
| do not want to be classed as ad-
vocating too many reforms, but T be-
lieVe a few able reformers, both
among the local agents and the COM
could bring about the desired
results If they would devote a little
time and thought to the subject.
Accommodate New Agents.
1t has been said that a fire insur-
ance company will sometimes carry
q target risk for a new, untried agent, |
when they would decline the same
risk for an old, faithful and good
Not long ago I heard of a case
where a company was dissatisfied with
an old and tried agent, and made al
transfer OF its agency to a new and
inexperienced man. He sent in a few
TO which the company objected
and ordered cancelled. The new
agent wrote a letter to the companyI
to the effect that he was running the
business and If they did not like his
way, to come and get their supplies.
They not only stayed on the risks, but
continued the agency. Ne old or tried