Honolulu star-bulletin. [volume] (Honolulu [Oahu, Hawaii]) 1912-2010, 1915-04-07
rate REGULATION
: tSPR9TESTED BY
INSURANCE men
Territorial Treasurer Believes
In Rate Regulation, But
After investigation

Members Of the Insurance Club OF
Hawaii and local underwriters made
an organized attack upon Hale's
house bin to establish state-made in.
Surance rates al the hearing of the
finance committee Of the house to-
night &. J. Mccarthy. TERRITORIAL in.
surance commissioner, was the only
champion OE definite rate revision,
: but he does not favor Hale's bill
Mccarthy recommended that in.
: stead of the powers of rate-making
being invested in the insurance CON-
missioner, as the present bill speci-
fies. a board of insurance experts
under territorial supervision look in
TO the matter Of rate-making. He
presented figures to show that Hawaii
is being Disseminated against in the
matter Of rates.
For example," Col Mccarthy said,
81 read in the insurance commission
er's report for the state of Wisconsin
where he complains against the rates
/ in that state. Those rates are less
than: In Hawaii; although l found that
!. the paid losses in Wisconsin for
the past ten years were about $40
{ on the 500 policy. ! have, compared
! those losses with Hawaii and found
that for the past three ten-year Pc
RODS the losses were IS, $13 and $14
Respectively.
Il do not believe that the insur-
lance companies are, making any too
muehi money, but: the fault Is in the
I fact that no sufficient survey has
been made. The companies have left
the matter Of rate making to the va
Tious boards Of underwriters and as
"a result In some states the companies
tare losing through low rates and in
Others the rates are too high, thus
/ balancing. What is needed is q ma
tion-wide survey and establishment
fof uniform and just rates throughout
THE United States by one system Of
underwriting" ~
A. R. Gurrey, secretary of the
board of fire insurance underwriters,
Twas on the stand and told how rates
were made. He. said that all rates
were based on what he termed the
Ideal city. This so-called ideal city
is not heated, has ample fire protec-
ttion and alarm systems, has no great
WINDS no steep hills. no sconffagra-
ton district" and has sufficient wa
ter supply. The rate for such a city
ifs Is cents Lack Of any Of the quail
I ncations Of the ideal city called for
an Increase IN the rates. For fn..
stance. he said, In Honolulu China
town was classeds as the coHHagra.I
tion district and 10 cents was added
10 the IDEAL city's rate Of Is cents,
making total of Is cents; and hills,
strong winds. etc, brought the mini.
mum rate ato,3a cents.
In making the building rates, fire
walls, rubbish and the nature Of the
business conducted add to the city
rate. unless the building is perfectly
ronstrueteds In accordance with the
Underwriters views. Attorney Frank
Thompson appeared for the insui.
ance men.
Chairman Watkins took the oppOr-
hinity to quiz Gurrey on the earth
quake clause Watkins asked the
witness why It was that Hawaii poll
Giles contained the eartiquake clause
when the islands have never had an
Earthquake disaster, when at the
same time the clause was deleted
from the fire insurance policies of
san Francisco, where already com
b3nies have been heavy losers
through eaEthquakes2 Gnrreyt replied
that he believed the cause could be-
removed. from the Hawaii policies on
proper petition to the head offices.
2 L.