Evening star., 1939-05-21
Taxi Insurance Rate
Is Cut 81 a Week.;
Price War Foreseen
District Officials Seek
To Regain Control
Of Premium Charges


Of Premium Charges
Taxicab insurance rates were cut
yesterday by number of the leading
insurance companies here from $3.75
week to $2.75. which, according to
j. Balch Moor, District insurance
superintendent, may lead to a rate
war.
The action is the second cut in
rates since April 10, when the Court
Of Appeals decided there was no
authority on the part of District OFF,
cials to set minimum limits. The
original rate had been set at $5.25
by the insurance superintendent, but
this was overruled by the appellate
court following suit by one of the
insurance companies.
How far down the rates could or
would be cut by the companies was
not estimated by Mr.. Moor. He
pointed out they could reduce weekly
payments as long as the companies
retained enough money to cover liza
bilities. Meanwhile District officials
are seeking ways to regain control
Of the insurance rates.
Authority Sought for Rules.
Mr.. Moor said he was fearful
rate war might result and has asked
for congressional legislation to give
him authority to put proper regula-
tions into effect. He said new
bill has been written by the corpora
tion counsels Office and received the
approval of the District Commis-
sioners. The bill now is before the
Federal Budget Bureau for study,
he said.
The insurance superintendent said
he did not expect any obstacles to
come up which would block pas
sage at this session of Congress-
The appellate court, in denying Mr.
Moor the power to make regulations
and rules, said The end sought was
both wise and desirable, but in the
present state of the law its accom-
plishment is possible only by statu-
tory amendment
The only limitations the insurance
superintendent now can put on the
companies under the law is the
maintenance of adequate reserves to
cover indemnities The law requires
$1,000 property and $4,000 personal
injury coverage for each insured
cab.
Insurance Heads Differ.
Executives of the local insurance
companies expressed mixed feelings
about the rate cut, some saying it
would be dangerous and others
claiming il would be of direct bene-
1T to the taxi drivers.
Jack Royer. head of the Colum-
bia Mutual, which insures the Pre-
rnier cabs, said ne would be forced
to cut to the s275 figure for the
District and meet the SO rate for
cabs operating into nearby States
'Tlais Is a competitive business" he
said, and we have to reduce our
rate, too"
He praised the work of the insur-
ance superintendent and said: Mr.
Moor deserves great credit because
the rules and regulations we're good
Mr.. Royer, who also heads the Pre-
n1ier Cab Co.. said his company had
been in business seven years and
the latest rate cut will cut into
driver dividends He said Columbia
Mutual would make it's cut effective
today
Higher Rate Seen Unnecessary.
On the other hand NJ B. Bildman.
secretary of the Hutchins Mutual
Insurance Co., said he felt the re-
duction would be of benefit to pol
icyholders in his company, and be-
cause of the large surplus on hand
the higher rate was not necessary.
Whether his company would make
any further cuts, he said, would be
based on experience. The reduction
became effective last midnight.
Representatives of out-of-town
companies said they would have to
consult their home Office before
making any rate changes At least
one indicated his company probably
would 60 along on the cut because
OF the competition.
Jack Dolton, president of the
Amalgamated Casualty, said his
organization has been asking for
the reduction for some time and said
into rate war. He pointed out his
group sought the first reduction
from S. to $375 for some time before
1t was adopted generally. He point
ed out the cut would stop excessive
commission payments as we'll as
develop a merit system for good
drivers. The new setup, he said,
would aid in breaking what he
termed sharp practices by finance
companies. His company put the
new rates into effect yesterday.
Lowest Rate Claimed Here.
Under the existing law the super
intendent of insurance has only the
right to set maximum rates and now
seeks through new legislation to get
full powers of regulation. Mr.. MoQi
said there is nothing he can do un-
less a company gets on the border OF
Insolvency. In which case he has full
authority to act accordingly, he said
He said Washington has the lowest
rate among major cities in the
country. AS a comparison he said
taxi companies pay S35 month in
Baltimore.
According to the latest report, as
Of April 20. filed with the insurance
superintendent. the Abbey Casualty
has 343 cabs insured here; Amalga-
mated, 1858; American, 13: Bankers
Mutual, 217: Capital, 300: Columbia
40e; Great American Indemnity, 8;
Hartford Accident & Indemnity. /;
Hutchins, 66s; National, 373, and
Pennsylvania Casualty, 266, for a
total Of 2970 taxis The report does
not cover groups which carry their
own insurance, such as the Diamond
group.
ICordenos Gives