Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1915-06-29
STATE REGULATION OF FIRE IN.
suRANcE TO COST NO MORE
THAN FORMERLY.
CHARGES WILL BE
LOWER IN INSTANCES
Specially Low Rates Offered to Fav-
orsd Ones Will Not Be PossibIe.-
Discrimination 70 30 sarred.-Appli-
ton Of Law May Cause Some Fric-
ton Until Conditions Are Understood.

Des Moines, June 29.-Fire insurance
rates under the new law providing for
state regulation of rates and rating
bureaus will be no higher than hereto
fore and in some instances they will
be lower, according to the statement
Of Emory English, insurance commits
sioner. when asked today as to
the truth OF the rumors that rates were
going to be higher. All fire insurance
rates will be equalized, he said, which
means that no favoritism will be
shown by companies to individuals and
all will pay alike. This will mean
that the excessively high rates will
come down while especially low rates.
secured by an individual through fav-
ororitism, vii, not be permitted.
An organization Of insurance experts
has established the Iowa rating bureau
which is taking over the Iowa inspec-
ton bureau at Cedar Rapids. In fix
ing the new rates the old Cedar Rap
! ids rates will be used as basis only.
There will be other rating bureaus,
| however. The state insurance COM
missioner is given the regulation and
supervision of these bureaus and the
rates and in case rates in any instance
are considered discriminatory or un-
just, the law provides for an appeal to
the insurance department. The insur-
ance department is authorized to in
vestigate the case in question and nix
a rate which is not discriminatory or
unjust. The ruling OF the department
is subject to court appeal by either
party interested.
May Cause Some Friction.
THE application Of this law may
cause some friction and misunder-
standing until it's conditins are under
Stood" said Mr.. English in state
ment issued today. while 1t will
mean a reduction in the rates on some
property 1t viii undoubtedly .ncreas SO
the cost to those who have heretofore
benefited through favoritism and re-
bates. But an equitable division OF
the concessions heretofore allowed and
proper credits for improved construc-
ton and fire protection will mean re-
duction in the general cost OF insur-
ance.
Insurance rates must be made eth
er by companies. without regard to
occupancy hazard, physical defects or
loss experience, or by rating bureaus
which survey the risks and take into
consideration the elements ABOVE
named or by the state. Under the new
law the second named method will be
employed and the state insurance COM
missioner given the regulation and SUI
pervision Of both the bureau and the
rates.
Some Exemptions.
Those county and state mutual as
do
tile risks are not affected by the rating
feature Of the law but in all other re-
spects the law is applicable to them.
The law prohibits any deviation by
agents from the rates as filed with the
insurance department. Companies are
not required, however, to charge and
collect bureau rates and competition
is not restricted and any company is
allowed to file a variation from their
schedule on fifteen days notice, pro-
viding the same rate shall apply to all
risks of like kind and hazard. This
prevents the influential property own
ers securing concessions in rates or
rebates not allowed the general public.
1T will be illegal for agents to re-
bate premiums charged or discriminate
in rates between individual risks OF
the same class or hazard.
Survey Of Property.
"The law requires insurance compa-
MES to apply the rates and schedules
filed with the state insurance depart
ment by the rating bureaus which sur
vey risks and base same upon con-
struction and occupancy. Property
owners may secure a copy Of the sur
vey of their buildings by application
to the rating bureau. They are thus
enabled to remedy defects in construc-
ton, reduce the hazard and can know
exactly the reduction that will be al
lowed in the insurance rate. In event
the rate finally fixed by the rating bu-
reau IS considered discriminatory or
unjust, the law provides fer On ap-
peal to the insurance department OF
the state, which is authorized to inves-
tigate same and fix arate which Is not
discriminatory or unjust, said action
being subject to court appeal by either
party interested.
'The new statute was recommended
by tho national convention of insur-
ance commissioners, which spent sew
eral years investigating fire insurance
conditions throughout the country.
Similar laws were enacted in Mime
sota Missouri. Oklahoma, Michigan,
North Carolina and Washington. Kan
sas and Kentucky have heretofore reg
ulated fire insurance rates.
Supervision Simp!;s;ed.
'.The question Of state supervision
OF fire insurance rate making is SIM
plified by the recent decision Of the
United States supreme court iE the
Kansas case, holding that the business
Of fire insurance is so Tar affected with
a public interest as to Justify legisla-
tive regulation Of its rates. This is
one of the most far reaching decisions
Of recent years and marks the era
when public rate-making replaces pri-
vate rate-making. The effect Of this
decision clearly is to place fire insur-
ance rates upon the same basis az the
rates Of railroads. telephone, gas, cleo
trio light and other public utility com.
pahies.
THE problem Of an equitable ap-
of the necessary contrib
utionS OF these who Join together in
payment OF fire losses has long per-
picked the insurance world and vexed
the insuring public. Public sentiment
has changed from regarding fire insur-
ance as wager on the part Of tho
owner that it would burn, to recogni-
ton Of the fact that the fire premiums
merely constitute common fund for
the payment of losses. From the lat
ter point Of view any discrimination
in the common contributions to be
made to such fund is necessarily UNI
just.
Part Of Evolution.