Evening star., 1943-11-07
40 Il 4EkkEE 4 =, kt(FTI0\1
Burton Supports Bill
For Control Of District
Fire Insurance Rates
BY DON S. WARREN.

Approval of the McCarran bill te
give the superintendent of insurance
power to regulate fire insurance rates
in the District was voiced yesterday
by Senator Burton, Republican, OF
Ohio. chairman of the Senate sub
committee which held hearings on
the proposal last month.
Passage of the measure has been
urged by the Commissioners in a re-
port stating that the rates now are
arrived at by District-licensed COM
panies by arbitrary and discrimina-
tory" methods and that the rates re-
suit in excessive charges. They
stressed the low ratio of losses to
premiums which has prevailed here.
The report of the Burton subcom-
mittee, expected to be filed shortly
with the full District Committee and
which may come up for action soon
after the return to Washington of
Chairman McCarran, will not be
unanimous. Senator Bushfleld, Re-
publican, of South Dakota, has an
nounced his opposition
Bushfield Opposed.
Senator BuShfleld, who did not
participate in the hearings, said he
saw no need for legislation to set
UP a fire insurance rating bureau
or to give the insurance Superin-
tendent rate 'o2ulation powers. He
said he felt that competition among
insurance companies should meet
the question as to the level of rates.
Ee said numerous States, including
his own. have not found the need
for such measures
On the other hand Senator Bur-
ton pointed out that the question
has been raised in recent years by
members of the House District APP
preparations Subcommittee when
considering funds for the insurance
department. The District govern
ment now is without authority to
control fire insurance rates. he said,
and the bill is intended to meet
this need.
In their report, the Commissioners
said that for the flve-year period
from 1887 to 1912, the ratio of net
losses to net premiums written in
the District was 30.4l per cent,
adding The difference between
the amount Of losses incurred and
the amount of premiums written
represents the amount of expenses
and profit to the insurer. There
fore. it will be seen that out of
every premium dollar paid by the
policyholders in the District for
fire and lightning insurance approx
imately 10 cents is absorbed by the
companies in profits and expenses"
Low Loss Ratio Here.
Albert F. Jordan, District insur-
ence superintendent. submitted fig
ures to show the loss ratio over the
20-year period ending with 1912
was 3l.50 per cent, having varied
from 1853 to 1882 per cent. At
the hearings. Senator Burton re-
ferred to reports that for the 30
year period premiums paid amount
ed to more than s43 100000. while
losses incurred ran to about s13,-
QUO OOO.
There was no objection to the
measure voiced during the hearings.
Lawrence J. Crawford, speaking for
the Insurers Association of the
District, favored the bill, and Frank
S. Dickson of the National Board
of Fire Underwriters said he thought
the bill perfectly fair" and that his
board was interposing no objection
Under the proposed bill, rates
could be lowered or raised on the
basis of findings as to the measure
of profits for periods of not less than
five years. A rating bureau would
be organized by the licensed COM
panies to operate under the supe"-
vision of the insurance superinten-
dent