New Ulm review. (New Ulm, Brown County, Minn.) 1892-1961, 1915-06-30
INSURANCE RATES TO BE CUT.

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turnout the state, when it was found
what a heavy rate Minnesota property
owners were paying for fire protection
short time ago has born fruit. A
general reduction Of rates has been
promised State Insurance commissioner
S. D. Works to 60 into effect July /,
next.
Property owners have been paying a
high rate without kicking for long
period but when general raise in rates
was proposed by the Insurance Com
panies thruout the Middle West, a loud
protest was voiced. It was shown by
the report of the Minnesota insurance
department bulletin No. SO that the
companies rates were already far too
high. Taking our own city for example,
it was shown that New Ulm paid out a
total of $34,434.27 in premiums in 1914
and received in return but $3,770.78
in paid fire losses. The companies get
the difference between these amounts.
Premiums received by insurance COM
panies from this city during the last
twenty-five years amount to $3.50, 345.85
and the returns have been but $146, 91O.-
80. And the conditions in all the other
cities of the state have been about the
same. And still the companies proposed
to increase the rates. This action on the
part of the companies led to the reduc-
ton of rates rather than the increase
they had at first demanded.
These reductions are the first results
of the fire insurance rating bill fathered
by Mr.. Works and passed by the last
legislature, giving to the insurance COM
missioner power to supervise rate-making
within the state. The negotiations
which resulted in the reductions have
been in progress nearly two weeks.
Officers of the several rate-making
bureaus in Minnesota early in June
notified Commissioner Works that the
national board of fire underwriters had
decided to raise fire insurance rates in
about dozen states in the Middle West.
Mr.. Works at once notified them that
under the authority Of the new rate
regulation law he intended to resist the
increase in Minnesota.
A meeting with the national board
was arranged, but before comforting with
them Mr.. Works laid the whole thing
before Governor Hammond and had his
unqualified approval to resist the pro-
posed advance.
The meeting took place at Chicago
last week. The underwriters were in
clined to rebel at first, but on notification
that he would invoke the aid OF the new
rate regulation law to the limit and
would force substantial reductions in
stead the officers capitulated.
/ Under the new schedules fireproof
buildings all over the state are to be
reduced Is per cent. All other brick
buildings are to be reduced Is per cent
in the southern division of counties, and
~ IL per cent in the northern division.
Public buildings, both brick and frame,
are to be reduced Is percent in the
southern division and IL 1-2 per cent in
the northern division.
A reduction of 20 per cent is to be
made in the annual rate on dwellings
and contents in all municipalities having
fire protection. The term rule, however,
is changed so that hereafter the rate for
three years will be two and half instead
/ of two times the annual rate, and the
rate for five years will be four instead of
three times the annual rate. With the
20 per cent reduction in the annual rate,
the three year rate will remain the same
and the five-year rate will be increased
about 6 2-3 per cent. The number of
dwellings insured on the five-year plan,
however, is negligible.
Unprotected dwellings, that is dwell
ings in villages having no fire protection,
will be reduced 10 per cent in annual
, rates. With the new term rule, this will
mean an increase Of IL IL per cent in the
three-year rates. The total value of
dwellings in unprotected villages, how
ever, is very small. To further aid in
surers in small villages, Commissioner
Works is preparing bulletin showing
how, by installing Inexpensive apparatus,
they could obtain lower rates. Unpro-
tected villages at present take the class
1ox1 e4o1
ing about $500 they may be rated in
class 5. He will also point out how those
in class 5 may, by improving their
apparatus, be placed in class 4, which
takes proportionately lower rate.
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