New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-09-04
Insurance lis
Affected by Cut
In Car Prices
Man Whose Type of Ma
chine Costs Less Now
Than When Bought Can
Get Only New Scale Policy

Occasionally notice is given of re-
duction in the list price of a popular
make car. Such decreases have been
so frequent that it has upset the basis
of promulgating rates for the auto
mobile insurance companies. Cars are
being ver-insured--with respect to
fire and theft. The average automobile
owner should become acquainted with
these facts, for the situation is such
now that it has created dissatisfaction
and misunderstanding. Many car own
the companies sending out reneual
policies and basing the value at much
lower figures than those Of last year
Take an Illustration, a touring car,
which at one time sold. at $500. Say
the price to-day has been lowered to
$1,000. The $4,000 car. from an under
writer's standpoint, cannot take the
listing of it's original price, but must
be figured on its present value of
ST, 800, less reasonable depreciation.
The automobiles, who paid $4,000 for
his car is "out of luck"
Some fortunate policy holders (cov-
erlng many popular types of cars), and
there are many whose policies have
from three to eight months to run, are
really over-insured, and it is very
become rather careless in protecting
the cars as against fire, and particu-
larly theft.
The so-called valued form of auto
mobile fire and theft insurance has
made the situation more serious, due
to the fact that formerly it was Gus
tomary for the broker to secure the
highest amount of protection, and com
petitive conditions between companies
lend aid to such practices. This is the
cause for over-insurance of cars to-day
Practically all companies have dis
continued this valued form from May
/, 1921, and are now using the non
valued form-which provides the ad-
justment for losses either through fire
or theft upon the actual market value
at time of loss.
Recently suggestion was made to
create a repair shop, where all dam
aged cars could be repaired for the
insurance companies, instead of adj
justing losses on a cash basis. To
shop could be owned and controlled
through the National Underwriters,
and only those insurance companies
who are members OF this organizatio
would be permitted to have damaged
cars repaired, for which they may be
liable.
This workshop, or service station
could be centrally located and worked
out on a basis Of a net cost job to
the company. 1t would naturally entail
more work for the National Underwrit-
ers, but with proper working force it
would benefit both the automobilst and
insurance company.
No doubt some financial condition
could be agreed upon, where each mem
Der would pay a reasonable sum of
money annually for the upkeep of such
q station. By such an arrangement
thousands of dollars would be saved
annually, and that would have direct
effect upon the loss ratio. The better
experience would reflect upon the prop
erty damage and collision insurance to
such degree as to decrease the pre-
MUM rates. Such turn of conditions
would be welcomed by motorists.
The companies, instead Of sitting
back and endeavoring to meet the loss
ratio by increasing premiums, would
do well to work from the other side of
the fence and help the man who paws
the premiums
| L. H. GOLDBERG.