The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1917-03-03
ANALYZES RATING LAW.
McMaster Explains Main Features of
Insurance Act.


Rating Act of 1917:
I'm order that the rating act passed
at the recent session of the general
assembly may be understood it's Diff
ferences from the Laney- Odom act i'm
torce heretofore are shown. The full
oetaiis are not given but the salient
points
Inc Laney-Odom act forbade fire
insurance companies from entering
INTO any compact Or combination for
the purpose of governing or control
ling rates charged for fire insurance
on property in that State but per-
mltted the companies to employ "a
common agent or agents to prepare
and furnish maps and other data as
to risks. and to supervise and advise
OF defective structures or suggest i'm
provements to lessen the fire hazard"
The attorney general held that this
permitted this common agent or
agents to furnish advisory rates, but
the companies were not permitted to
enter into compacts to enforce them.
The 1917 act provides that fire in
surance companies may individually
or in cooperation with other compa-
| nies maintain or be members of a
rating bureau.
"A rating bureau may consist of
one or more insurers, and when con-
sisting of two or more insurers shall
admit to membership any fire insurer
authorized to do business in this
State
| Every fire insurance comrany
shall in its annual application for Ii
cense specify each rating bureau
making rates upon property located
within this State, of which it is a
member and during the year file
written notice of any other rating bu-
reaus of which it shall become a
member"
No fire insurance company .
and no rating bureau . shall enter
into or act upon any agreement with
reference to the making, fixing or
collecting of any rate for fire insur-
ance upon property within this State"
unless such agreement "be in writ
ing and prior to it's taking effect q
copy thereof be filed with the insur-
anCe commissioner
The insurance commissioner may
after due notice and hearing, upon
complaint or upon his own motion
make an order disappearing any such
agreement or any part of such agree
ment. The action of the insur-
ance commissioner in making or re-
fusing to make any such order shall
De subject to summary review before
court of competent jurisdiction in
this State"
Under the Laney- Odom act the in
surance commissioner had power ito
review any rate charged for fire in
surance for the purpose Of de-
termining whether the same is dis
crminatory or unjust His find
lngs or order shall in all cases be
subject to summary court review"
: Under the 1917 act the South Car
oilna insurance Commission, consist
ing of three members appointed by
the governor, has power to determine
Whether a rate is discriminatory.
or excessive or unreasonable" In re-
spect to excessive or unreasonable
rates its determination must be based
upon the results of the business of
STOCK fire insurance companies dur
ing the five years next preceding the
year in which the investigation is
made Amy action of the said COM
mission shall be subject to summary
review before court Of competent
jurisdiction without prejudice to
other party involved"
1.-THE Laney-Odom act contained q
section which forbade agents giving
rebates or premiums or discriminate
ing in methods of payments Of pre-
miums or in any other way between
insurers of risks. This section is re-
pealed and there is no similar section
in the new law, SO the agents and in
surers are perfectly free to make their
own terms one with the other.
The 1917 act prohibits fire insur-
ance company from making any rate
| which discriminates unfairly between
risks in the application of like charg-
cs and credits, or which discrim-
/ mates unfairly between risks of es-
| sertially the same hazards, territor-
ial classifications and having substan-
TALLY the same degree of protection
against fire..
The relations between the compa-
nies and their agents are regulated
by section Is Of the 1917 act, which
provides: No fire insurance company
| or other insurer and no rating bureau
shall require any agent or make any
| agreement with such agent whereby
the said agent shall not write insur
ance in any company not q member
of any rating bureau in this State
nor shall any company or companies
enter into an agreement to refuse to
write insurance through any agent or
agents or broker who represents any
companies not members of any rating
bureau now or hereafter to be estab-
lished in the State
Under the 1917 act the insurance
commissioner may address inquiries TO
any individual, association or bureau
which is or has been engaged i'm MAX.
ing rates or estimates for rates for
fire insurance on property in the State
In relation to the organization. main.
tenance or operation or any other
matter connected with it's transactions
and may require the filing of sched.