Arizona republican. [volume] (Phoenix, Ariz.) 1890-1930, 1921-02-10
FIRE INSURANCE
BUSINESS UNDER
FIRE IN SENATE
Lid Is Taken Off In Discus
sion Of Methods In State
Bill Recommended F o r
Passage

The lid was taken off the fire in
surance business in Arizona yesterday
In the course of a discussion in the
committee of the whole of the Schlei-
mer bill for putting the fire insurance
companies doing business in this state
under the espionage of the state cor
poration commission. The bill is a
copy of the Kansas law which has been
in operation for the last five or six
years. 1t differs from the Kansas law
and the laws of some other states only
In that instead of creating an insur-
ance department it puts the control of
the companies under an existing
agency.
Representatives of the board of I'M
derwriters desired to be heard on the
bill and an arrangement was made for
their appearance at 2:30 o'clock yes
terday. Four of them from San Fran
cisco were present and the case of the
companies was presented by Mr.. Long.
He described the hardships that had
been put upon the fire insurance COM
panies in Kansas under the law. COM
polling them to go to the courts for
relief
The returns of the companies had
been cut down TO a minimum. His
address covered three quarters of an
hour. at the end of which time Senator
Schleinfer reminded him that he
had not touched upon the main thing
aimed at in the bill, the relief of Ari--
IONA from discrimination in rates and
the discrimination between towns and
even the insured in the same town.
Mr.. Schleimer said that it had been
brought to his attention that the rates
in Arizona were from 100 to 200 per
cent higher than rates on the same
classes of property under similar con-
ditions I'm California, New Mexico and
Texas. Mr.. Long replied that he had
not understood that that phase of the
question was to be discussed and he
could not answer this question: but he
referred the questioner to one of his
associates who stated that in the abb
sence of information concerning the
rates in the states mentioned by Mr..
schleimer he could not make a COM
pariscn. But he said that all the rates
were susceptible OF a reasonable ex-
PLANTATION.
Declares Rates Jumbied
Mr.. Schleimer replied that that was
the trouble. The rates were so jun
bled and confusing that they were not
easily understood and could mot be
comprehende6 by the average man and
for that reason II was desired that
they be put under the supervision of a
body that could understand them.
Former Senator Harry Harms of No
gales as the Representative of the in
sured." was then given the privilege
of the floor. Mr.. Harms had been large
ly responsible for the introduction of
the bill. He said that the agitation
in Nogales for a regulation of insurance
rates had begun several years ago,
without result. Various insurance rep
resentatives had visited that town at
the request of the chamber of COM
merce and had admitted the inequitable
arrangement there and had promised
relief which never came. Then it
ulatory legislation and the Kansas law
seemed best to meet the needs of the
state.
That law had been resisted by the
fire insurance companies and had been
sustained by the United States su-
preme court, In an opinion by Mr.. JUS
tice MKenna, from which the speaker
read excerpts. Mr.. Harms had also
fortified himself by letters and tele-
grams from the insurance department:
and Kansas and other states where the
business OF life insurance was under
regulation
1t was true, he said, that the rates
OF the insurance companies as applied
were difficult to understand and thu
best he had been able to secure was al
average of rates. That disclosed tina
than the average rate of any othel
state, much higher than that of New
Mexico. though less insurance wa
written there.
Compulsory Insurance
One condition was much more marked
in Arizona than in any other state
compulsory insurance. Much of tn
property, farm products. hay and cot
ton served as collateral for loans. Ais
xxytfr hr1i1 in raar w
borrowed money, and insurance Q
such property was REQUIRED. The own
err was helpless and obliged to accep
tho rate that the board of .underwrit
crs might fix.
There was, said Mr.. Harms, unac
countable discrimination between town
and between property of the same
kind in the same town under simila
conditions. He mentioned the case Q
a lumber yard at Nogales situated
within 100 yards of an excellent fir
department The proprietor had in
stalled plugs throughout the yard an
had taken every possible precautio
against fire. His rate was $3.50. Di
vided from his yard by nothing NOR
than q paling fence was another Ium
Der yard in which no precautions a
all had been taken. yet the rate fo
that yard was $3.50. Mr.. Harms de
scribed such discrimination in othe
parts of the state.
One of the San Francisco represent
atives denied that there was discrim
ination between California and Arizo
ma. He said that the rates were abor
the same in towns of the same size
the two states. He compared Phoeni
with Dinuba, Cal, and other coas
towns of which the members had nevt
heard. Someone suggested informa
ton concerning the Fresno rate. Til