New-York tribune., 1921-05-30
Drop in Fire
Insurance Cost
Is Predicted
Un,ermyer Says Lockwood
Exposures OF Millions
in Profits Will Cause
Speedy Cut III Premiums
Moran ON Trial To-day
Prosecutor Considers Plea
of Stadtm Her to
Reveal Inside Grafls9

A considerable drop in fire insurance
expenses to householders is looked Tor
shortly, as a direct result of the Lock
wood committees attack against the
operations of the New York Fire In
smance Exchange.
Samuel Untermyer. chief counsel TO
Che committee, characterizing the eX-
change as "the most despotic monopoly
in the country" declared its operations
were costing the people of the state
$30,o00,000 in excess of what they
should pay. Alfred NJ Best. the in
surance expert, who testified before the
committee last week, declared yester-
day that the exposures should result in
an early looping off OF about 10 per
cent in fire insurance expenses. Mr..
Cntermyer believes the estimate is eX-
tremely conservative and that the saw
ing should be much larger.
Reasons for Opinion
In support of his opinion the COM
mittee's counsel points to the large
dividends the mutual fire insurance
companies are able to return to their
policy holders or the basis of the same
rates charged by the stock companies.
He insists that il the mutual com
panies were admitted into membership
in the exchange on an equal basis with
the stock companies, and were per-
mitted to continue the payment of divi-
dends to their policy holders, the re-
sulting competition alone would effect
an appreciable saving.
Mr.. Untermyer feels, too, that the
double licensing of brokers and agents,
whereby agents agree to do business
with none but exchange members in re-
= 1r9oic csicN
should be eliminated and the per cent
saved to the public. The expense of
doing business, declared to be about 40
per cent of the collected premiums, Mr..
Untermyer holds, is also too large and
should be pruned down.
When the committee resumes its ses-
sions tomorrow morning in the City
Hall it is understood that Mr.. Unter-
myer will inquire into the investments
of the fire insurance companies and
their alleged gambling in highly specu-
lative stocks. In this way, it is de-
clared, the companies tried to Increase
their incomes rapidly. The subsequent
depreciation of these stocks is said,
however, to be responsible for the
writing down Of assets" testified to
at last weeks hearings.
'Unrevealed Profits
The "unrevealed profits" in the
financial affairs of many of the com
panies referred to by Mr.. Best in his
testimony could be made another
source of saving to the public, Mr..
Untermyer believes. The law provides
that so per cent Of the pemiums col
lected by the fire insurance concerns
must be laid aside as reserve fund to
meet any losses during the year 1t
has been testified that only about half
1F IL IN SC l1l F-,-
such purposes, and that the other half
is usually invested. The income of
the ten largest firms in the country
from this source alone is said to be
S10,000,000 Mr.. Untermyer thinks the
public should derive the benefit of this
income in decreased rates.
hTe report that Peter Stadtmuller
the delegate of the Dock Builders
Union convicted of extortion, was to
"blow the lid" off the Building Trades
Council fell like bombshell among
labor men, who are familiar with the
operations of Robert P. Brindell, the
are known to have been his intimates
These men may have further cause
for fear to learn that Stadtmuller's
plea that he be heard is being con-
sidered by the District Attorneys
Office. 1t is more than probable that
he will be given an opportunity to
spring whatever sensations he has at
the trial of Joseph Moran, coming up
tomorrow morning before Justice Nc
May Testify for State
Moran was indicted on the same
charge with Brindell and Stadtmuller.
Stadtmuller is to be sentenced Thurs
day. He has been negotiating with the
District Attorneys Office to be per
mitted to tell what he knows about
labor Irregularities in New York in re-
turn for recommendation for
clemency.
Under the circumstances Stadt-
mulleer would take the stand as a
Moran, another of BrindelPs lieuten-
ants.