The New York herald., 1922-01-28
Downward Revision Agreed
Upon as Only Just to En-
ploying Builders.
WAGE SCALE EXTENDED
Lockwood Committee Meets
To-day for Probably Last of
Present Sessions.

housing, yesterday led frontal at
tack upon the rates of the stock com.
panies writing employers and public
liability, casualty, credit, automobile
plate glass and other insurance. He
maintained that these rates affect Tx
cost of building anywhere from to
per cent. The result of an exhaustive
examination of half dozen witnesses
recognized as authorities in the in.
surance field, was:
That there should be q reduction.
estimated by one witness at so per
cent, in the rates for these classes
Of insurance.
That there should be State super
vision of rates, and power LODGED
with the State Superintendent OF
Insurance to revise rates downward
when necessary. Opinions OF wit
nesses on this point were unani-
nous.
That the National Bureau OF
Casualty and Surety Underwriters,
or whatever ratemaking organiza-
ton is maintained by the stock
companies, shall be thrown open to
the mutual companiee on equal
terms. as was done in the case OF
fire insurance companies.
Albert A. Whitney. associate general
manager of the National Bureau. and
an insurance actuary of high standing
was again the chief witness. He ad-
rnitted that certain Of the rates now
charged such as for liability insurance
on iron ana steel erection work. elevator
erection and similar work. were "de-
cidedly excessive" and might be re-
duced a half. Mr.. Untermyer thought
two-thirds, but Mr.. whitney would not
go that far.
Some Figures Startling.
Some OF the figures showing the per-
centage of nrofit on this sort of insur-
ance were startling on their face. but
wsre partly explained by the fact tina.
the volume of such business is small
and the extraordinary profits are offset
by loser or other lines. The premium
paid in 1920. for instance, In New York
for liability inpu-an~e on iron and steel
erection was sl.l0 for every 500 of pay
roll. The ac.usl loss was 3.4 cents out
of every st.lr prcmiurp collected.
For elevator sr~ctIon the premium was
50 cents on every elc of payroll. ard the
actual loss 80 cents. or about 2.359 per
cent. The total premiums paid for this
class OF insurance In New York in 1870
were 1896 and the loss $71s. In the
classfricr ton known as Ia itor WORK in
buildings the insurance rate was 2S
cents fos every 500 payroll and the losses
o.6 cents, repres snt1ng O e 'oss profit for
companies OF ~ per cent.
Mr.. whitney. after studying a sched-
uIe OF statistics OF the various classes
of insurance entering into the building
industry az an item Of cost admitted
that tho average p-ofi's we're about 42l
per cent. ard that tie ratios could well
be cut hale. lie admitted that In
Septembef. le2n his bureau began q sur
vsry with view OF makb.g rate reduc-
tons. but that they he'd not yet gone
into effect. nearly year and q halt
after the wo-f was undertaken.
His exploration Of the excessive ma
ture 90 the ratss as they appeared on
the soheSule provided by V,e committee
was thst the big sdvO.ce in wages fol-
lowing the outbreak OF the war had
added 10 the total premius collected on
the basis OF payroll. but thar no action
had been taken 70 reduce the rates In
accord With the tcrensed wage scales.
"That's a pretty strong argument fol-
State supervtS'on. don't you Think?
Mr.. Untermyer asked The witness said
II was. NJ. Whitney admitted also tha,
the cost OF automobile insurance In New
York was excessively high. but as the
committee was only interested in It's
relation to trucking costs in building
operations that phase of the subject oi
interest TO owners OF passenger cars
was not pursued.
Favors Power of Review.
Jesse S. Phillips. formerly State
Superintendent OF Insurance, now gen.
eral manager of the National Bureav
of Casualty and Surety Underwriters
at salary OF $4,000 a year, was the
second important witness to conced,
the desirability OF State supervision
of rates In the casualty field. Mr.
Phillips would not recommend State
ratemaking, only the power of review
by State authority. He would not ad.
vocate the opening of tho National Blu
reau to mutual companicc. for the rea.
son that tho mutualr now are permitted
20 avail themselves Of the rate making
facilities Of the bureau. and no thought
the stock companies had the right. Il
they wanted to exercise Il, of main.
tanning an exclusive organization.
IT believe" Mr.. Phillips said. in ex.
PLANTATION OF his position that wher,
there Is practically monopoly regu.
lated by law In the making OF any in.
surance rates. and while Il may no'
change the result. I think It Is righ
that power should be lodged somewher,
for a review OF those rates, for tn,
purpose OF determining whether or no
they ara excessive. and that they coulc
be so fixed that the burden would fal
as equltably as may be ascertalned upon
the different classes
Francis r. Stoddard. Jr.. the present
State Superintendent of Insurance
agreed fully with Mr. Phillips and Mr.
Whitney. He went even farther, anc
said he could see no objection TO the
admission of the mutual companies tc
nembershp in the National Bureau
The mutual companies. Il was testified
can write certain classes of casuait,
and liability insurance at about Is pei
cent. less than the stock compan nies
owing to their reduced cost of dolns
business and the fact that they do no
have to provide for agents commits
sfons
Samuel Deutschberger. chief OF tn.
rating bureau Of the State Insurance.
Depe rtment. was the fourth 70 adml
the desirability Of State supervision oi