Evening star. [volume] (Washington, D.C.) 1854-1972, 1913-04-06
CRITICISM Of METHODS
Of FIRE UNDERWRITERS
Chicago Grand Jury Indicts
I Fifty-Six Alleged Members
of Arson Trust.

CHICAGO, April "a report bristlinl
with criticism of methods employed b.
fire insurance companies in the issuance
of policies was made to Judge Burke to
day by the special grand jury which ha-
been investigating the So-called arson
trust.
one alleged incendiary fires, and involv
ing fifty-six alleged members OF TIT
trust" were returned.
The report declares that SO per cen
Of the fires in Chicago are of In
cendiary origin. This condition OF al
fairs. the report asserts, Is due Il
laxity on the part of the insurance
companies in examining the propert!
insured and the relaxation of vigilance
after q policy has been granted.
The report recommends that tn
Grand Jury's Recommendations.
companies should establish centra
inspection bureau. to which all appli
cations for policies would be referred
and that the city be divided into dis
tricts in each Of which an fnspecto
would keep close track of insured
property. with a special reference t
the removal of goods after insurance.
Fire underwriters Of Chicago foun'
many objections today to the recon
mendations Of the grand jury while up
holding. their spirit.
The Jury recommended that the com
panies adopt q policy Of fighting ever,
loss they were convinced WAS crook
ed" loss. declaring that the present sys
tenn is compromise.
'"The grand jury finds that the business
OF arson Is regularly carried on by man!
iac yc ad
the report said. ''It is the practic'
among insurance companies to accep
what is known as rotten risks from
brokers in order that the companies may
also get the good risks from the same
brokers'"
Insurance officials Views.
N. J. Nashten, president Of the Chicago
board of fire underwriters, said tonight
1.-The. success Of the changes recon-
mended by the special grand jury de-
ponds largely upon aroused public sent
ment. The fire insurance companies arr
eager to reduce the crime of arson. bu
all the changes that have been suggested
penalize one hundred honest men to head
off one crook. Inspection OF property.
advocated as the chief remedy by those
not familiar with the business. would
make insurance prohibitive in cost tt
small families. The average premium
for a small fiat is 81 year. and it would
cost as much more to make an effective
inspection.
Dishonest persons easily could ar
range to stand inspection, taking away
the goods before the fire.
Duty Of the Courts.
"FaiIure to fight crooked claims is a
responsibility that rests chiefly on the
courts. Until the present agitation
companies were merely wasting their
time and money in trying to secure
convictions for arson. On some Of these
"frebug" cases the insurance com
panies have spent as much as $4,000.
only to have the men get free.
ut hurts the business Of company
to have a reputation of contesting
losses. especially when the guilty per-
sons escape in court. If the public were
familiar with all the facts it would
wonder that the companies have spent
as much money as they have in ap-
parently fruitless efforts to convict the
incendiaries in the face Of apathy of
the authorities and the public"