The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1918-04-10
HIGH INSURANCE RATES.
Fire Insurance Companies Explana-
ton of The Recent Ten Per Cent.
Advance.

In line with action taken in other
parts Of the United States, fire insn,-
ance compa MES operating in the
South have made an advance of 10 per
cent in rates on all classes which were
not included in the increase of last
summer. The advance is in the ma
ture of a war emergency charge,
made necessary by abnormal condi-
tions arising IN account Of the pres
ent war. TIL increased charge is
made only to meet the demands cre-
ated by present conditions and will
not last beyond their continuance.
The increase is effective at once
In 1917 the fire insurance COM
panies in the South were compelled
in order to meet increasing expenses
and losses, to advance the rates on
certain Improbable classes of risks.
The companies claim continued growth
of such expenses and losses has dem
onstrated that, increased revenue from
other lines is required to meet the
abnormal con1itions produced by the
war. A 10 per cent increase in rates
on the classes of insurance not ad-
vanced last year to meet, in parr,
these increased and growing expenses
is necessary.
According TO the statement Of the
companies, the rates on these classes
of property are no higher now than in
1914. Since that date the expenses OF
| conducting tie fire insurance busi-
ness have increased enormously. The
companies announce that increased
salaries on account of the higher cost
| of living. travelling expenses of neces-
| sary representatives, cost Of station
cry supplies and postage, as we'll as
the heavy inc sase in taxation, have
raised the percentage of expense on
all items from 5 per cent. on some to
more than 100 per cent. on others.
The companies claim that another
item of outgo--perhaps the most i'm
portant of alt-is the Increased cost
of replacement, due to the advance
ir cost of materials and labor, which
is said to have increased more than
SO per cent. as compared with one
year ago. The large majority of fire
losses are partial losses, requiring re-
placement or repairs.
The increased war taxation on capi-
tai. stock corporation income and
premiums wiLI absorb, SO the compa-
nies announce, the greater part of the
income from premiums, which here
tofore has supplemented deficiencies
from premiums.
The changed conditions have been
recognized In all other kinds Of bus
mess by increased prices. so the in
surance companies point out.
In 1917 the fire losses in the United
States increased approximately $685.
10000 over 1916. A large portion of
these losses is attributed to condi-
tions developed by the war; Many
suspicious los IS indicate the work of
alien enemies and the actual danger
Of fire losses Is greater than before,
according to the analysis of fire in
surance experts. Omitting 1917 as a
year above tbs, average, the compa-
MES tabulation of insurance under
writing results for the past ten years.
ending with 1916, shows the average
profits to have been but 1.067 per
cent. The aggregate of all items Of
increase due 20 prevailing conditions
cannot be less than 10 per cent, ac-
cording to the companies estimate.
The companies also point to the
fact that they are compelled by law
to preserve intact their capital and
insurance reserve, They point to the
fact that to allow these to become re-
duced or impaired would be followed
by the legal forfeiture of the right to
continue to do business. as well as
the lessening Of the protection given
J to policyholders.