The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1916-08-18
Insurance Agents Claim Fire
Rates Are Equitable and
on Scientific Basis
COMPARISONS MADE
IN INSURANCE RATES
Outside Company's Pay Neither City
License Nor State Tax, States
Mr.. Leedy, and Can Give
Cheaper Rates

tive to the insurance rates as fixed
in Birmingham by the Southeastern
Underwriters association made him
more confident than ever that the
Southeastern Underwriters association
is a combine to set arbitrary rates on
fire insurance in Birmingham.
Various insurance agents operating
in this city took exception to the state
ment of Mr.. Barber in regard to in
surance rates as published in Wednes-
days Age-Herald, and contend rates in
Birmingham are just and based on fire
hazard.
81 promised the voters of this city
that 1 would see that the present rates
on insurance were lowered" said Mr..
Barber. II distributed thousands of
cards in this county and on each one
of them 1 made that pledge.
IF man has insurance on his home
and it burns down, he can recover 25
per cent more than his loss If he proves
that the company in which he is insured
is in a combine I have absolute proof
that this has been done in this state
on several occasions. The state pro-
if the insured can prove that the COM
pany who wrote his insurance is in
combine.
IT know that the present rates on
insurance in Birmingham are not JUS
tifiable. 1 intend to snow the people
that this is a fact and not theory. The
rates on insurance are fixed by the
Southeastern Underwriters association.
In my opinion, this association is run
ming in direct defiance to the state and
federal laws.
VAST DIFFERENCE
THE Woodward and Brown-Marx
buildings have an insurance rate of
IL cents. There is a building across
the street from the Woodward that
pays 81. 1 am free to confess that l
cannot understand this vast differ
ence. One of the hottest and hardest
fires to fight was the Empire fire.
A loss of $4,000 was caused from this
fire.
ut would be necessary for a number
of small buildings, with rate of in
surance 10 and sometimes Is times
higher, to burn to the ground to &C
crue loss as large as the Empire loss.
Yet this buildings has a rate of 80
cents per hundred while a building
next door, only two stories high, pays
$1.30 per hundred. l have the facts that
figures on this matter and 1 intend to
make them public.
Il know a citizen who wanted insur-
ance on his apartment house. He was
quoted a rate of S1.50 in Birmingham
He did not pay it. Instead, he went
to New York and had his policy writ
ten on basis of so cents per hundred.
Why is this? This method of proce-
dure is alright for the man who has a
big apartment house and wants to get
the best insurance rate possible 1t
pays him to go to New York. but how
about the man with a little cottage?
By the time he goes to New York he
has spent more than the premium on
his policy will amount to in several
years"
Herbert Levy, an insurance man,
who is thoroughly familiar with the
insurance business in Birmingham, in
speaking of Mr.. Barber's fight of the
underwriters, said:
The rates on insurance for Biz
mingham are as good as any city in
the south, with the exception of New
Orleans. That city deserves q lower
rate of insurance on it's excellent fire
record
NO GUESS WORK
Just because the insurance COM
panes operating in Birmingham have
made money for the past two years, is
no sign an attack should be made upon
them. In the last 20 years, exclusive
of the past two years, the insurance
companies have paid out $1.23 on every
dollar they received in premiums. The
rates of the Southeastern Underwrit-
ers are based on science. There is no
guesswork and never has been.
''The figures of this association are
compiled on the aggregate figures on
fire losses throughout the south. If
mans rate is high, his hazard is high.
l have figures and data on the work.
ings of the Southeastern Underwriters
association and 1 will be glad to make
this public"
Ed S. Moore, secretary of the Bir-
mingham Fire and Casualty associa-
ton, and familiar with all classes OF
insurance, said:
Some of the fire insurance compa-
MES operating in this city have been in
business for period covering 200
years The figures on rates for insur-
ance are based on science engineer
ing and experience. There is no such
thing as discrimination. The whole
proposition of basing insurance rates
is scientific business in charge of
experts who have done nothing but
men are the braniest and most skilled
in their line that money can get.
1.-THE fire rates are based on the ques-
ton of hazard. If a man Is in a fire.
proof building he gets a better rate than
the one who is in building built of
wood and not fireproof This is reason
able The rates on insurance are based
on the schedule of the Southeastern IN
derwriters.s which. as l said before, is ar
rived at by science and experience.
IF a man has a building with an open
elevator shaft and wishes to lower his
rate all that is nece, y to do is to close
that shaft. He then gets lower rate.
Is this not fair? If tman has build
ing that is a good ris and pays a nomi-
nal rate of insurance on it and wants
to reduce that rate by putting IN a
sprinkler system he can do so. l know
of several instances where sprinkler sys-
TENS have been put in buildings Of Bir-
mingham after they were built to reduce
their rates.
CONDITIONS DIFFER
]. Y Brame. of the Jemison-Seibels
insurance company, said:
1.-The rates on insurance are based on
fact. II the hazard is great the insur-
ance is higher. If the hazard is not great
the insurance is lower. All of this is
arrived at on a scientific basis known as
an analytical schedule of rate making.
Different conditions of the building to
be insured result in different rates. The
age of the structure, it's condition, Its
capabilities for resisting fire and many
other things are taken into considera-
ton. The whole thing is technical and