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2,908 54


29.81




2.091,745 90


745.571 92


6.257.101 26


2,898,781 03 .


43.1


2*4i


15,674 57


2,511 74


42.432 80


17,199 90


40.3


1 96


2,891 74


274 60


9.732 18


30,862 05 ,


315.09




5,105 63


7,072 48


14.357 60


9.085 77 '


83.08


2*28


23.331 81


1,391 93


51,989 47


14,311 33


27.53


1 08


4.042 82


8.759 05


12.87P 13


10.038 20


77.94


3 03



Digitized by



GoogI(



Ixxvi Report of the Commissioner of Insurance.



Table Shmoing Premiums and Losses Paid in the Towns Entitled to



Popula-


Town.


19

Premiums.


11.

Losses.


1912.


tion,
1910.


Premiums.


Losses.


558


Montfort


$2,131 01
2.103 24

1.185 57
2.901 47
5.786 92
4,469 89

62 90
E35 59
01 51
72 66
135 82
30 18
156 26
56 02
12 2^
47 02
38 44
24 61
70 65
47 95

15,836 90
28,454 74
6.220 68
5,341 85*
1,603 43
2,541 49


$420 00
14 22

97 00

300 00

305 06

17,392 89

4,091 15
868 31
880 69


$1,549 81
1,919 61

1,272 51
3.676 42
5.374 51
4.492 87

27.895 70

7.932 47

8.625 06

8.750 16

930 50

1.290 61

3.674 83

4,676 81

3.635 55

18.818 91

15.518 15

1.712 27

1.285 13

7.393 90

15.609 83
22.796 66
5.989 85
5.173 15
1.927 48
3.009 78


$458 50


671


Monticello


442 62




Morrison Town, Brown
county


44 50


482


Mosinee


1,134 77


1.048


Mt. Horeb


21 40


798


Muscoda


153 47


5,784
1.957
1,570


N
N
N
N
N
N
N
N
N
N
N
N
N
N

Oconomowoc

Oconto

Oconto Falls


20,946 85
2.977 04
6.126 98


804




1.175 00


379
708
889


90*12*

576 06
300 00
773 96
583 68
148 65
91 35
778 50

552 10

12,067 23

2,389 89

1.711 90

905 99

605 43 '


49 87
509 98


1,074
2,888
1.988
1,960
647
1.860

3.054
5,620
1.427


2.118 62
5.020 50
2.271 46

864 26
2.736 24

106 61

10.194 27
9.188 12
3,615 73


1,285


Omro


611 80


1,146


Onalaska


29 58


712


Oregron


29 25


380


Oosibun?




449


Orfordvllle


3,657'85*

4,042 30

170.562 19

2,083 88

64 03

165 44

136 76

197 32

98 51

56 93

145 02

164 46

i86 35

162 10

155 79

.«,J08 29

2,807 08

2.397 88

2.816 80

5,325 85

202,536 83


5.335 03

848 61

28.039 08

182 42

529 40
2,829 04
11.474 31
2.548 10
2,926 34
28.160 02

512 74
5.132 74
5.981 28
5.906 24

355 82
5.810 28


8.093 98

4.507 64

178.925 54

3,170 12

2,997 42

16,953 63

7,408 33

9.244 25

3,428 64

14,065 60

1.387 32

14.596 97

16.823 19

22.727 36

2.223 23

11,782 45

8,255 73

1.772 70

2,858 69

5,462 43

2,435 83

204.223 62

4.981 49

2,455 14

970 59

4.881 21

14.924 07
2,657 32
2.9.53 63

43.208 49
3,793 52

17.157 69

16,940 29
3.149 72

21.620 47

7,110 21

627 92

1,.540 27


1,694 01


634


Osceola


103 00


33,062


Oshkosh


10.732 99


745


Owen


416 61


987
1,972
1,975
1,948

723
4,452

805


Pi

Pi

P<

PI

PI

P]

PI

PI

P<

P< on

Pi

l\ "•■:::•
l\ ::::.::

P]

Pi

Racine


78 00
4.704 43

20.690 28
1.010 63
1.505 50

22.542 18


3.094
5,440
3,792

656
3,149

699


182 62

5.743 92

1.620 22

59 50

23.067 92

81 83


606

936

1,269

436

38.002


14.604 56
30 56
424 73
69 50

163,884 16


750

971 82

2.202 74

390 86

81.548 75


937


Randolph




408


Random Lake


i. 720' 75*
1.284 06
2,139 69

1.3.443 00
2,477 58
2,686 66

56,305 83
5,317 78

17,266 75

16,520 80
2,881 45

21.926 00
6.640 64




88 22


515


Readstown


1,275 00

617 71

6,250 71

15 00

75 10

10.297 07

556 04

1,411 36

26,143 47

2,438 12

1,092 91

6,938 48




1.521


RedOanlte


1.654 89


2.615
550


Reedsbursr

Reedsvllle


10.886 78
93 81


352


Reese vllle




5,637


Rhlnelander


17,245 47


1,018


Rib Lake \




3.968


Rice Lake


5,219 60


2,652
704


Richland Center

Rio


16,217 16
38 95


3.7.TO
1.991


RIpon

River Falls


21,387 18
2.100 38




Rosendale Town




383


Rosholt


1,268 28


309'62*


87 00



Digitized by



Googla.



Report of the Commissioner of Insurance. Ixxvii



Fire Department Dues for the Tears 1911, Idhi and i5i^— Continued.



S1,7M 34


82,203 09 1


2.810 M


1,171 09 1


S55 88


1.114 79


5.004 01


1.571 03


5,352 33


249 73


5,088 27


4.710 99 1


15 00


4.102 93 1


n 19


1,483 17 1


10 54


2.775 53 1


57 23




1)0 85


1,200 00 1


18 01


22 60 ,


BO 72


2,256 11 1


42 32


302 04 1


12 77


669 62 '


W51


3.533 54 1


06 85


40,870 25 !


50 04


133 64


i.«60 73


48 30


8.187 88


8.452 40 1



07 91
10 42
^32
68 90
120 55
S8 97
114 44
149 95
195 65
56 28
-J44 77

6t51
48 08
56 88

65 18
18 72

44 46
14 33
77 30
00 98
55 56
16 13
98 76
65 56
26 79
04 18

45 82
_._75 84

199,657 62
5.708 27
2,108 88
1.296 00
2,288 96

16.501 79
8,088 28
2,982 65

87,076 61
8,022 28

18.170 22

14,860 40
2,067 88

10,684 68

6.086 00

066 70

1,071 11



40 12
26 43
65 93
84 06
60 60
78 18
46 76
17 06
58 90
91 49
50 70

48 45

28,735 29

378 59

215 80

924 45

4,854 28

189 02

4,699 96

181984 66



9482 40

4,540 71

10 00

198 80

350 00

4,611 16

41,549 26
1,801 10



800

40195

6,070 25

2.228 76

8 75

7.885 60

380 54

5,266 60

5.630 22

6,369 23

20,656 94

392 66

69 00

80 90









Averasre






58


annual loss






1.


per capita.




13,076 50 1


57.11


1911-18.


85,387 16


$183


6,338 78


1.628 53

1


25.72


81


2,818 96


1.256 29
3.005 80


44.65
24.08




12,481 90


2*08


16,463 80


576 19 :
22,257 35 1


3.50


18


14,031 03


158.6


9 29


74,273 69


29.140 93 ,


39.06


1 80


22,549 25


5.328 52


23.64


91


11,947 11


9,283 20


77.1


1 97


9,089 06








3,067 26


2,'375*06*


77.'44"**


2*60


3,639 35


71 97


.197


06


11,891 31


2,856 16


25.06


1 42


15,174 65


878 10


.578


35


11,180 57


3.088 24 1


27.62


96


39,905 44


9.328 00 ,


23.38


92


43,961 94


43,725 89


99.45


7 33


4,686 92


646 55


1.38


11


!,825 51


2,875 89 1


75.18


15


22.429 73


9,837 51 ,


41.64


1 67


44 14


13.486 49


29.70


1 47


«1 82


35.876 78


45.4S


2 12


45 35


8,971 55 1


50.82


2 09


73 90


6.307 76 1


40.77


1 64


51 46


2,296 17 ,


42.11


67


10 24


2,197 86 '


26.18


1 09


14 44


145 76 i


6.3


13


01 78


8,846 10 1


93.11


6 57


45 59


510 51 I


.424


27


44 01


88.468 56 |


17.36


89


98 77


2.849 73 ,


32.80


1 27


20 96


655 85


7.451


22


«2 15


81,268 76


55.77


5 28


m 47


32,552 18


156.5


5 41


06 75


3.774 03


12.66


63


40 87


5,356 38


50.83


2 47


66 99


50,556 43


112.4


3 78


46 67


701 76


1.69


77


88 78


10.115 32


21.99


100


110 47


15,274 56


29.9


93


45 02


21.511 12


30.32


1 89


95 15


415 32


6.598


21


134 50


38.310 60


119.58


4 05


i28 37


4.631 54


48.61


2 21


07 87


14.622 06 '


239.8


8 04


79 67


1,200 68


13.83


43


.M.<;84 10


2,977 47


18.8


78


4,711 67


5,071 52


107.6


354


606,418 07


286,977 17 1


47.32


2 85


10,689 76


1.301 10


12.17


46


6,284 27


38 22 1


.608


03


3,550 65


1.288 00


38.31


83


8,759 85


2,674 55


30.54


62


46,868 86


22,657 74


48.35


288


9,123 18


2,832 58


25.57


1 41


8.572 94


78 85


.919


07


136,590 93


35,428 14


25.04


2 09


12,133 58


936 .58


7.72


31


52,594 66
48,321 49


11,897 65


22.62


1 00


47,990 85


99.31


6 03


8,988 50


8,846 30


98.43


4 19


63.181 15


43,136 98


68.62


3 84


20,737 75


9,431 47


45. .58


1 58


1,584 62


69 00
435 92 .


4.35
9.12




4,779 66


88



Digitized by



GoogI(



Ixxviii Report of the Commissioner of Insurance.



Table Shomng Premiums and Losses Paid in the Tvwns Entitled to



Popula-


Town.


1911.


1913.


tion,
1010.


Premiums.


Losses.


Premiums.


Losses.


867


Sauk City

SaukvlUe Town.

Ozaukee county

Scandinavia

Schleislngerville

Scott Town. Sheboy-

ffan county

So vmour


$2,508 04

1.674 06
1,400 71
8,250 54

4*
4

1
1
7
1
9
5
1


$83 41
60 58


$2,724 65

1,822 15
1,534 06
3.174 40

559 06
6,138 28
3,608 22
16.237 36
144,564 71
7,885 04
5.043 28
5,304 61
2,050 26
3.760 13


$97 86


355


1.910 07
8 57


538


37 00
847 25


1,147 66


1,100


703 00
1,368 22


879


Sharon


10 17

311 28

220,641 01

1.241 43

2.871 71

283 03

891 32

3,141 28


25


2,923


Shawano


12,030 10


26.398


Shebov jran


27.327 03


1,630
902


Shelioygan Kails

Shell Lake


1.280 41
10.160 57


1,063
667
569


Sh-""- —

S<

St

s<


520 65

1,456 SO

565 00


6.092


s<

S(
Sj
Sj
Sj
Si
SI
Stevens Point


9,633 95


2.634 42


13.028 32


023 06


8.07.?

1.453

730'


11
77
63
.57
89
41
36
32
„.,.,. 28
286,837 01

1.537 35

1,529 33

3.566 62

4.281 60

349 03

12,567 06

27.501 19

360 00
3,235 70
17.042 98

2.574 91

920 40

2,651 20

3.184 88

15,748 61

4.704 86
20.869 40

7,386 71
45,844 91
47,573 65

2,715 18

14,559 16

11.730 04

114,18.-, 17

3.898 77

4.146 64
12.375 97
1.610 42


2,770 8i
3.562 98


15,620 02

5,808 02

2,774 80

1 4,402 08

1 12.461 46

38.248 12

1 21.836 40

21.389 34

5.986 55

301.620 22

1,599 84
1,555 12
8.181 81
4,288 27
310 22
14,664 08
25.461 65

603 45

3.061 62

19.843 79

3,251 30

2.405 23

15,008 20
3.426 10
16.304 04

4.058 66
18.358 06

7.410 64
46,960 35
46.796 33

2.625 48

16.615 63

11.649 14

112.963 65

3.806 88

4,583 29

17,203 77

1.292 67


i.7i7 66

4,081 70

151 02


972




35 25


2.675
8.692


5,250 45
4.749 08
2.837 10
15.700 18

"'244.'256'28*

201 46
26 00


2.481 12
13.060 87


4.761


Stousrhton


373 53


4.262


SturgiBon Bay


14.148 50


1 110


Sun Prairie


188 65


40.284


SuDerior


30,585 71


345


Theresa .\


10 00




Thiensville


1,000 00


741


Thorp


1,062 25


728


Tlgerton


30 00


7,807 31




Tlsch Mills




3.410


Tomah


922 48
1,630 10

50 20 ,


"' 468 6i


2.007


Tomahawk


20.465 53




Trenton Town.

WashinfiTton county..
Turtle Lake




442


172 67
4,148 25


4.850


Two Rivers


730 52
50 65
652 42

1,005 42

127 00

5.417 92


835 73


616


Union Grove


880 55




Unity Town— Trem-
pealeau county

Vaughn Town— Iron

county— Hurley

Viola :






156 06


671


21,081 78


2,050


VlroQua


5,125 84


755


Walworth


752 20


3,830


Washburn


2.114 59

1.154 01

18.820 58

26.049 94

92 18

5.200 42

244 74

31,158 08

86 59

5,688 22
1.888 94
1,559 20

160 00

4.387 62

80,245 52


3,182 28


1,220
8.829


Waterloo «

Watertown


441 00
3,280 50


8.740


Waukesha


47,248 73


550


Waunakee


75 60


2.780


Waupaca


4,263 02


3.362


Waupun


1,448 90


16.560
964


Wausau

Wautoma


37,951 52
10 00




Wausaukee Town.
Marinette county . . .

Wauwatosa

Welcome




3.346
341


2,174 59
1.469 87




Wayne Town— Lafa-
yette county




6.645


West Allls


20.539 68
13.088 82
13.258 09


29.961 31
18.493 19
10.167 70


7.167 85


2.462


West Bend


26.608 73


002


Westby


177 90



Digitized by



GoogI(



Report of the Commissioner of Insurance. Ixxix



Fire Department Dues for the Years 1011, 19U and i9iJ— Continued.



19]


13.

! Losses.


TOTAI.. r.


Three year
ratio of losses
to premiums.


Averafire
annual loss


Premiuirs.


Premiums.


Losses.


per capita.
1911-13.


13.779 02
1.602 99


824 98

06 50

132 00

7 61

6.294 01
2.872 79


$9,012 61

5.190 10
4.599 88
9,580 63

812 15

19,122 46

6,880 76

49.792 92

424. m 39

25,338 22

13.248 58

14.096 26

8,005 14

11.145 20

912 72

37.982 87

762 96

44,442 43

15.741 32

9,091 42

13.517 49

86.942 93

110,442 30

72.007 25

65,664 21

18.275 78

987.454 17

5.818 39
4,644 86
10,571 08
13.671 55
893 88
41,666 80
71,027 69

1.555 90

8,934 71

58,861 17

8,966 03

5.135 89

26.485 71
9,948 57
47,643 57

12,260 18
52,871 99
22,664 31

140.455 65
189,038 60

8,011 00

45,809 12

35,995 46

881,600 46

11,110 31

11.510 46
42,587 92
4.113 32

817 27
72.840 31
41,431 51
29.397 42


206 25

2,476 15

' 140 57

1,192 il

7,435 16

3,741 01

19 42

24,087 18

259.429 73

2,582 95

18,066 37
1,065 79
2.897 71
3,853 10


2.09

39 99
8.057
12.44

915.6
19.56
.304
48.38
61.13
10.19
98.64
7.55
86.2
34.57


$0 80


1,656 11
8.155 69

252 19


13
74


6.004 14


1 12

008


17.283 1"»
133.455 07
8,100 81
8.746 10
4.304 46
2.874 28
3,256 26
912 72


11.745 80
11.461 69
HI 11
84 09
253 11
550 00
146 82


2 74

3 28
53

4 83
83

1 78

2 26


15,825 60
762 96


5.768 06

87 50

8.811 98

2.508 24

191 48

4.997 81

108 61

19.427 77

1.2P0 77

6.401 91

99 05

71.453 09

86 57
271 04

1


9,325 54

87 .-SO

8,299 79

11,047 92

343 40

5,032 56

7.925 18

37,238 62

4.501 49

36.349 68

287 70

846.289 08

257 93
1,297 04
1,062 25
8,808 05


24.55
11.47
18.65
70.16
.377
37.24
21.45
83.72

6.25
55.85

1.596
35.06

4.43
27 .f 8
10.05
64.42


51


18,814 80

5,098 53

2,983 90

4,476 84

11.494 58

84.588 77

26,598 40

21.248 55

5,826 95

898.987 94

2.681 70
1.560 41


70
253

16
1 73

99

1 43
82

2 84
08

286

; 25


8,822 65


1 48


5.101 68
238 78


880 74


! 4 08


14.435 1b
17.974 85

592 45


5.387 84
4.704 50

2.087 47
8.429 42
1.492 85

6.190 68

718 00

88.228 92

1,837 69

25,128 02

8,887 60
2,184 42
1.884 47
8.222 09

23.900 44

21 58

4.556 69

4.153 47

12,895 80
66 75

5,778 28
1.281 26


6,778 28
35,800 13

2,310 34
12, .577 67
3,059 10

6.580 88

1.521 48

60,266 07

1,964 69

35,666 78

4.639 89
7,431 24
2.079 48

24,882 17
97,199 U

189 31
14,021 03
5,847 11
82.004 90

172 34

13.641 09

4.640 07
1,559 20

170 00
12,229 82
109,616 05
224 99 1


16.27
50.4

148.5

140.8

5.68

75.41

29.63

227.5
19.75
74.86

37.84
14. a5
13.21
17.68
69.9

2.36
30.61
16.25
27.75

1..55

118.2
10.89
37.9

58.58
16.91
264.6
7.66


1 66

1 4 11


2.687 89
16.974 40

3.189 78

1.810 26


' 9 48
21

556


7,926 81




1
I


3.887 50
15.500 02

8.496 66
18,644 53

7,857 96
48,1.50 89
44.668 62

2.670 34

14.614 38

12.616 28

104.451 64

8,404 66

2,830 58


i 98

5 75

2 35
65
82
94

3 71
12

1 67

58
1 65

€0


13.008 IK
1,210 23


46
1 53


317 27


10 00

674 35

2.766 80

47 00




21.889 82
14,899 50
5.971 63


61

14 84

83



Digitized by



GoogI(



Ixxx Report of the Commissioner of Insurance.



Tabu Showing Premiums and Losses Paid in the Towns Entitled to



r .

Popula-


Toww.


1911.


1913.


tion,
1910.


Premiums. Losses.


Premiums. Losses.


729
840


Westfleld...
West Salem

w

^^
w
w
w
\\
\\
w
w

Total....






967






703






3,224






551






510






940






443






1,090






739








)wn—
oty








1.192.650


$6,345,966 41 |$3. 115,690 64 1 16,456.619 62 1 $2,545,981 04



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Report op the Commissioner of Insurance. btxxi



Fire DepartiMnt Dues for the Tears 1911, 1912 and i5i5— Concluded.



1918.


Total.


Three year
ratio of losses
to premiums


A^eraflre
annual Iqas


Premioms.


Losses.


Premiums.


Losses.


■"iW^


38 00
50 04
43 85

t?^

62 40
61 53
(56 20
m96
(42 00
148 51


$1,226 92

30 47

4.156 20

90 30

2,075 93

495

"* io.723'64

88 05

2,038 66

158 20


$10,890 69

12,837 54

16,786 01

11,469 63

1 41,987 87

5,416 81

5,359 52

9.434 62

10,917 52

14.137 47

10.221 51

1.671 86


$1,979 46

94,277 67

6,794 75

7.885 65

6.310 23

495

488 14

11,148 26
1,384 14

83,782 19
1,007 20

1,913 46


18.17
734.4
40.47
68.76
15.03
.09
9.109
118.2
12.68
238.96
9.85

114.45


$0 01
87 41

2 34

3 73
65

10 38
43








$6,388,784 86


$2,346,312 58


$19,191,870 89


$8,007,934 26


41.73


$2 24



Ins.— f



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Ixxxii Rei^out of the CoMmissioneu of Insurance.



LEGISLATION RECOMMENDED

The National Convention of Insurance Commissioners, con-
sisting of representatives from the insurance departments of all
the states, at the New York meeting, on December 8, 1914,
adopted the two following reports and recommendations for
legislation:

To the National Convention of Insurance Commissioners:

Tile Special Committee on Fire Insurance Rates and Rate-
making reports:

Pursuant to the following resolution adopted at the last an-
nual meeting of this Convention at Burlington, Vermont, July
31, 1913, viz.,

** Resolved, That a special committee of nine members be ap-
pointed by the President and required to investigate the rates
charged by fire insurance companies, the methods of making
such rates, the effect of anti-trust and other related laws upon
such rates and upon the making thereof, and to report thereon
from time to time to this convention ; and, if legislation be found
desirable to report its recommendations for legislation, which
shall be uniform as far as possible for the several States."

The following commissioners were appointed as such com-
mittee :

Herman L. Ekern of Wisconsin
Chas. G. Revelle of Missouri
J. A. 0. Preus of Minnesota
E. H. Moore of Ohio
Charles Johnson of Pennsylvania
Burton Mansfield of Connecticut
Wm. T. Emmet of New York
Wm. Mason Shehan of Maryland
E. F. Van Valkonburg of Idaho

Messrs. Rufus M. Potts, of Illinois, Frank Hasbrouck of New
York, and R. M. Small of Ohio, were later appointed members
of the committee.



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Report of the Commissioner of Insurance. Ixx x iii

Meetings.

The committee has held meetings at the following times and
places :

October 8-11, 1913, Chicago.
November 10-14, 1913, New York.
December 12, 1913, New York.
April 10-12, 1914, Chicago.
June 10-11, 1914, New York.
Sept. 14, 1914, Asheville.
Dec. 7, 1914, New York.

At the meetings there was a representative attendance of of-
ficials of both stock and mutual insurance companies and per-
sons engaged in rate-making.

Scope of the Investigation

In the progress of its work thus far the committee has studied
the economic bases of fire insurance rates, the methods of mak-
ing the rates, and the relations between rate-making and other
problems in fire insurance. The statutory law with respect to
fiirc insurance rates was examined, and the similarities and dif-
ferences in the problem in various states were noted. The com-
mittee also made inquiry into the causes that have led to dis-
content or disagreement between the public and the companies.

State Power Upheld by Highest Court

The question of fire insurance rate-making is one of con-
stantly increasing importance. It is simplified by the recent
decision of the United States Supreme Court in the Kansas
case, holding that ''the business of fire insurance is so far af-
fected with a public interest as to justify legislatiye regula-
tion of its rates." It is also becoming recognized that the
m*ore important subject of fire prevention is intimately con-
nected with rate-making.

Who Makes the Rates?

Although fire insurance is a private contract, its cost, or the
''premium/' is not determined by free and personal agreement



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Ixxxiv liEFORT OF THE COMMISSIONER OF INSURANCE.

between the parties. Bates are obtained from tariffs or sched-
ules applied by rating or inspection bureaus upon an investi-
gation of each risk. Such, at least, is the theory of schedule
rating, although there are large classes of property, such as
dwellings, which are not rated specifically or even inspected
but are charged a flat rate. The rating bureaus are usually
owned and controlled directly by the fire insurance companies.
This is not the case, however, in the Upper Mississippi Yalleyy
where they are usually known as ''independent bureaus,'' al-
though supported by the companies which subscribe for their
rates. There is usually one rating bureau to a state or group
of adjoining states; as, for instance, the Ohio Inspection Bu-
reau, covering Ohio; the Kentucky Actuarial Bureau, cover-
ing Kentucky; the Wisconsin Inspection Bureau, covering
Wisconsin (except the cities of Milwaukee and Superior) ; the
New England Fire Insurance Exchange, covering most of New
England ; and the Minnesota and Dakota Inspection Bureau at
Minneapolis, covering Minnesota, North and South Dakota, and
the Southeastern Underwriters Association, covering the South-
eastern states.

The Basis on Which Bates abb Maob

Bate-making has developed from an arbitrary flat rate to a
comjuex tariff or schedule of charges. The development has
been gradual, and is, of course, an attempt to approximate a
fair apportionment of the insurance tax. To this end the
original flat rate was increased or decreased to conform to dif-
ferences in the degree of hazard, as nearly as they could be
determined by the judgment of the rater. Later, under defi-
nite schedules, additional charges and credits were used to
further differentiate degrees of hazard. Bates, charges, and
credits were from time to time subjected to rough tests to
ascertain in a general way the volume of premiums which would
be produced by them. Furthermore, the desire of the eom-
panies to secure the profitable business, and to avoid the un-
profitable business, has operated as a test and adjustment of
the rate.



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Report op the Commissioner op Insurance. Ixxxv



Why are Bates Made in Co-operation f

The work of rating inyolves the expenditure of considerable
sums of money, being about 1% of all premiums. This ex-
pense is too heayy to be borne by companies separately, and
hence companies combine in rate-making organizations. From
one-half to three-fourths of the companies contribute to the ex-
pense of making the rates. The other companies obtain the rates
without pa3dng for them.

The question of expenses also limits the number of rating
bureaus to one for each division, or at least one for each group
of risks. This places it within the power of those controlling
the rate-making bureau to take unfair advantage, by discrim-
ination, either in the rates made or in the service with regard
to rates, or even to deny its service to individual companies.

The Relation Between Rates and the Reduction op
Fire Losses

The problem of dealing with fires involves the liability to
loss, as covered by insurance, and the causes of fires as affect-
ing their prevention. The business of rating, primarily in-
tended for insurance purposes only, can be made a powerful
agency for fire prevention. To make rates it is necessary to
know the probability of a fire, which involves the possibility
of its prevention. A classification of risks, with a tabulation
of the premiums and losses for each class for a period of time,
indicates whether the charges and credits applicable to a class
as a whole are too high or too low as compared with other
classes. It may also indicate the increase or decrease of hazard
for each class, the probable extent of future loss, and the
progress of preventive work. Such a classification has been
prepared by the National Board of Fire Underwriters, and it
is proposed to invite all fire insurance companies to submit
annually their records of fire losses, with amounts of insur-
ance involved in each loss, and all amounts of insurance writ-
ten, to be compiled by a central bureau into an experience
table which will later serve as an aid in the adjustment of fire
insurance rates.



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Ixxxvi Report op the Commissioner op Insurance.



Present Supervision op Ratk-Makinq

A rate-making or inspection bureau furnishes expert engi-
neering service with regard to hazard of fire. For insurance
purposes a written survey is made for each risk upon which
the schedule charges and credits are made to determine the



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