Poverty Bay Herald. PUBLISHED EVERY EVENING. GISBORNE, THURSDAY, MAY 28, 1905. INSURANCE RATES.

Poverty Bay Herald, Volume XLI, Issue 13392, 28 May 1914, Page 2

Poverty Bay Herald. PUBLISHED EVERY EVENING. GISBORNE, THURSDAY, MAY 28, 1905. INSURANCE RATES.

The . business community of Gisborne is sure to have read with interest the explanation offered m our columns last evening .on behalf of - the fire insurance companies, but we doubt whether many crumbs of satisfaction will . he- obtained therefrom. Briefly the explanation for the recent, levelling «up of rates is that m• the past the • tariff*- of the companies has not ; been losely adhered to and that _business.' people liave been getting insurance at much cheaper rates tlian they were properly entitled to. This is an argument that is altogether too thin. It assumes,- in the first place, that the representatives of the underwriters m this town did not know their business,, that they haye not. been loyal to the tariff, and -that -as a result of competition they have been m the habit of cutting rates. Anyone who has any tiling to do with the insurance people knows that the contrary is tlie case. They are keen and v competent insurance men. They have had their tariff for years and hay* r worked closely to it. Any person wanting to obtain insurance covers .who has . sought ' prices from the various argents, lias ; invariably found himself up against the ; Btone wall of a uniform tariff. Even if '"through, any oversight of a- particular cause for "loading" a cheaper rate may luyvo been obtained, from an agent than the tariff intended to allow, the error has generally been discovered and' a claim, mado for additional premium^ . Nor has the responsibility for adherence to the tariff imposed by the .Underwriters' Association been wholly cast upon the agents. Inspectors have been. 'coming round at intervals ) for ' years supervising the work of the agents, ..inspecting the risks, and doubtless making certain that the right premiums have been charged. Are we to understand that these inspectors also have not known their business? If thr present levelling tip had consisted merely of '.'raising a man's rates by .twopence," as one gentleman interviewed yesterday suggested, it might easily have been understood that discrepancies had been overlooked by the agents and inspectors, butwhere, as was shown m our article, rates havb soared from 9a to 17s and 21s 6d \vithout any adequate explanation to "the insured, then the business people so 'affected may fairly be entitled to take with tho proverbial grain of" salt the .explanation that the tariff has not been properly understood by agents m the past. We know of an instance where before building extensive business premises ,a person conferred with the insurance companies and ob tamed a statement of the premium he would be required to pay, and the saving m insurance that was shown would lie the result of building in ' brick induced him to put up a> structure costing some thousands of pounds. To-day he ITnds tliat the cha%6s havo . been niore than, doubled oh tlie -amount tljat he was told he woiild be ratedfor. In the instance referred to m yesterd&y's issue, m which it was suggested that structural alterations may have increased' the risk, arid thereby justified raising ■ the premium, the structural alterations have materially increased, the security of the risk, and when they were m progress .the work was inspected by one of bur most competent insurance representatives, who advised tliat no alterations m the tariff rates would be necessary. There are business people throughout the town who will discover as their premiums fall duo. tha,t the rates have been doubled and trebled, and we shrill be surprised if 'the "commercial interests of Gisborne" will take the matter lying down. We 'are glad to note that tho insurance combine is having trouble else.vhere. than at Gisborno. . No less a [person than Mr John 4 Duthie, of Wellington, has been' hit, and hit hard, by an attempted adjustment of the tariff. Mr Duthie owns "Donbank," a high class boarding establishment m. Wellington and an excellent risk, seeing that the building is practically isolated. Yet his premiums have been raised from 10s per cent, to 39a per cent., an increase of £56 per annum. Mr Duthie is naturally annoyed and lias published m the Dominion some illuminating 'porrespondence with the insurance companies, m the course of which Mr Duthie remarks: "The insurance position dis-

mmm-wmmmm—'mwmmmmmmw appear to be raised to whatever suits you. Your council, like the Star Chamber of old, or the Tsar, as reported, is unapproachable, and it similiarly autocratically levies its exactions. You tell me that the underwriters, 'with the exception of the elect,' are making a dead loss on their insurance business. Confirming this, directors; of two local companies have told me that they only pay dividend;, from interest on investments. You rightly ascribed to me a lack of sympathy with the State m its insurance ad venture, yet, despite its changes m management that Department has re-' paid ita small original capital, and, by its 1913 report, is now able to carry on the Department upon its reserve, which, as reported, amount to £48,213. Then the successful results shown by the several farmers' combinations do not appear different from the Department's last experience. I am not an expert, bub the unprofitable result whicli you point to suggests a lack of vigilance Over risks, with an excessive cost of administration. Apparently, your remedy is to build up an altogether preposterous tariff, and to adopt >an autocratic' attitude designed to prevent the protests of those you penalise from even being heard."