Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1915-03-15
INSURANCE RATES.
rSioux civ Journal.1

The Iowa legislature should give
earnest consideration to the bill for
the regulation of insurance rates sub
mitted by Emory English, state tnsur-
ance commissioner. The bill contem-
plates the maintenance of uniform
rates on the same classes of property
by fire, lightning, windstorm and hail
insurance companies doing business in
Iowa The object aimed at Is salutary.
If the principle is approved time
should be taken to disclose and remedy
any errors of detail. If objection is
taken to the principle the legislature
should make it its business to find and
apply better one. The fire insurance
business in Iowa is sadly demoralized
for lack of stable uniform rates.
The bill offered by the state insur-
ance commissioner provides for the
creation of rating bureaus. A bureau
may comprise an insurance company,
a number Of insurance companies or a
person or company not directly in the
insurance business. Every insurance
company operating in Iowa would be
required to affiliate with rating
bureau and accept its rates as the
basis for Iowa business. The rating
concerns would be subject to inspec-
ton by the insurance commissioner.
Any property holder could go to a
bureau and ascertain the rating on his
property. If he should believe the rat
ing unjust or discriminating he could
appeal to the insurance commissioner,
who would, after hearing, have the
right to order the substitution of a
reasonable, nondiscriminatory rate.
e the proposed system should work
ont as planned i would provide uni
form rates for like classes of property
and like hazards turnout the state.
The rates could not be made too high,
for it would be the business of the
state insurance department to keep
them at a reasonable level. Under the
lack of system which now prevails
some policyholders pay abnornally
high rates while others get the benefit
of abnormally low rates induced by
cut throat competition. II there Is any
business in which a standard of uni
form, reasonable rates should be
maintained it is the insurance BUSH
ness Everybody must understand
that there is no such thing as an
insurance bargain. A company can
not sell insurance below cost and con-
tiuue in business. Every cent that is
paid out to the policyholders. The
insurance company is merely CEN
trail agency in which policyholders
pool their risks and bear their losses
in common, paying the central agency
a fair commission for its trouble. I'm
der the circumstances 1t is idle to urge
insurance companies to compete in
making low rates to get business. Just
as soon as a company gets to making
rates that are too low, the more bust
ness it gets the sooner 1t will go broke.
In that case the policyholders will be
the main losers
The state is justified in saying that
the insurance companies shall not get
together and agree upon a system OF
rates that will muict the property
owners Of more than a reasonable
commission on the cost of carrying
their insurance. On the other hand,
the state should not leave the COM
panies without some means by which
uniform, reasonable rates may be
maintained The important thing
from the public standpoint Is that the
rates shall be uniform as well as rea-
sonable and that there shall be no
favorite playing as between property
owners OF the same class. II the
English plan shall be found to fill the
long felt want ii should be adopted. II
it should be found wanting the lesis-
lature should hurry up and devise a
better plan