The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1922-05-21
MOTORISTS MORAL
HAZARD LOOMS BIG
ON NATIONAL PLAN
Personal Character Is
Now Important Factor
With Companies.
PROVE CAR OWNERS
Complete Auto QUESTIONABLE
Employed by Prominent
Concerns.

An interesting factor. which is
perhaps little known to the great
majority of motorists who apply for
insurance on their cars. is that he
more substantial companies are
now looking very carefully into
the moral hazard likely to be in
CURED in writing insurance. In
other words, the personal character
Of the automobile owner seeking
insurance is being Investigated 20
an extent never done before. The
moral hazard, while not a nov city
to some companies, is in its recent
tendency toward a nationwide ap-
plication. something new in auto
mobile insurance.
Not only in New York. but in
many of the larger cities in the
country this character Investigation
is very thorough. Its wider appli-
cation is primarily due to the heavy
losses of the past year or two n
lost OF stolen cars combined with
the increased use of motor vehicles
for criminal or Objectionable pur-
poses. Certain motor car owners
who have had the unfortunate ex-
perience of having their insurance
applications denied would do Ibtless
find. in the final analysis, that the
report on their personal character
istics, involving possibly some tinan-
cial difficulty Objectionable mode of
living or careless or suspicious use
of the car. had been deemed an I'M
safe moral hazard. Perhaps some
OF these declined applicants by the
more reputable companies nave been
able to get motor insurance else
where. for there are concerns whore
this care as to personality is not
so rigidly observed.
\ representative Of one of the
group of companies in this cry.
which is making the moral hazard
basis the prime factor in writing
insurance said yesterday that he
believed that so per cent of the APP
rIicatiOns made to his companies
were refused. This fact, - many
motorists. will appear as something
startlincly new in the world Of au-
t"r1Obile insurance. He also added
that. instead of a decrease IN n':si-
ness. the aCcreSate value Of motor
Insurance bv these companies has
shown a decided increase. ind cat
inT a more careful discrimination
- the part of owners to take their
I inEur"nce in respons bile concerns.
CIV Thoroughly this moral haz-
kfrd investigation works may be
~ in the case Of an applicant
- " town several miles from
CIV York. The first report sent
Nv tNN AGENT was fairly good, but
=" "~as"ntative here was not
hut" satisfied and requested an in
'-~tiOn 10y an AGENT Of a large
'--',.f c0mn"ny now making a bust
Z q nF oh
s~t'"ns for a large group Of sub
~-h'"G insurance companies. This
r~~"-t showed nothing detrimental
- 'NA man himself. but it indicated
tN-t he was the associate of low
800 t"-~ md suspected Of afilia-
ton" With b00t1e-cers Here was
-" company REGARDED as
T"t"'-~e0t"l moral hazard. as the
:'r'~''"9 nt'S car. even without anv
V"lit'C0 "f his own. might be taken
fer "hieCti"rThIo uses and the in
suranca arpl' cotton was denied
=" STOW how carefully the char
""t"r Of the motor car applicant is
l""i-e6 for to determine his moral
ard hazard ""aIity. the following
vt ~ Questions arc required to he
Filed out ~ accurately As possible
~ tie agent to whom the app1i
cation is made. This is the standard
9"t""~ "hile GTest;onnaire wed as
P1 insurance basis by practically
oil ~ the reputable companies:
!. Is assured of legal ace7
Race or color. Nationality.
? Has any insurance company
every declined or Cancelled insur-
ance for or on behalf of assured
----.-.-.-..If so. state particulars
and give name of insurance COM
pa .--.-....-
;. Has assured made claim foI
any automobile or other loss with
in the last three years..
so. give full details.
4. Is the risk direct or brokered q?
.'-.------. .......
D How long have you known the
assured .....-...
6. Is assured financially able to
own and maintain this automo>
que ..--- ..-..-......
7. Is the assured involved in any
financial or business difficulty
g. State how long the assured has
been engaged in present occupa-
tlon -.------ And whether now en-
plOyed-
3. Has the assured any source of
income other than stated hereina
.....
lO. Have you personally inspected
the automobile? Ts ~ a.
good condition..
H. BY whom IS automobile
orlNenE..-.. -....
IL. Does the assured ever permit
the automobile to be parked in tn,
open over night?
13. II bought second hand e;ro