Document ymB663aoDgr6YDJ3Xzk65EByE

FILE NAME: Insurance Industry (INS) DATE: 1932 Dec 1 DOC#: INS034 DOCUMENT DESCRIPTION: Article from The National Underwriter - New Occupational Disease Plan Out ! ASUALTY AND SURETY m m . ^ rJ yt sk SECTION dia# wqjly i Page Twenty-three Convert Many Old A. & H. Policies, to Newer Forms .'WO MAJOR CHANGES MADE F. P. Stanley Resigns from the Glens Falls Indemnity JOINS LLOYDS OF A M E R I C A New Occupational Disease Plan Out {eduction in Principal Sum and Re striction on Permanent Disability Payment Offset Becomes Vice-President and ISuperintendent of Agents with Julius Barnes' Company National Council Makes Program Effective Dec. 31 in Non Regulated States > NEW YORK, Nov. 30.--Considerble headway is reported by accident nd health managers in getting their olicyholders with older forms of accient coverage to convert at renewal to te new uniform type which has been dopted by many companies that are lembers of the Bureau of Personal Acdent & Health Underwriters. The medical reimbursement feature is te inducement in these cases. When ie new standard form was adopted it as not proposed to force old policyolders to accept it. However, the reuced principal sum and other items of :duced liability under the new form lade it desirable to obtain converts -nong the old policyholders where pos ble. The privilege of covering all med al, nursing and hospital expenses up > $500 per $5,000 of principal sum is jually enough to offset the lowered rincipal sum and somewhat less libal provisions of the new form. C hange In P rincip al Sum The reduction of the principal sum om $7,500 to $5,000 is usually not of rime importance to the policyholder, 'e generally has life insurance in a ifficient amount so that the 33J^ per:nt reduction in his accident death mefit is not an important item. The lange in the total permanent disability ause, which is the other important alration in the new form, is not such as > cause the average policyholder to ilk at accepting that form. While the latter pays for only 52 eeks for "his" occupation and for life lly for incapacity for "any" occupaon, as against the former type paying ir life for "his" occupation, the, insured not likely to think in terms of techcalities. As a matter of fact, the >urts in a number of states have still 1 decide what constitutes total perma:nt incapacity to perform "any" occuition. While the liability on this point ay not be reduced by the new disabily clause to the extent that the com mies would like, yet it is believed that e revised wording will go far toward ttting down the number of cases in hich a company is obligated to pay a e annuity to a man who is only techcally incapacitated and is making perips more money in his new occupation an he did in his previous one. D ubious A bout R eim bursem ent Many accident and health men, even the companies which have adopted e new program, are frankly afraid of e possibilities of the medical reimirsement feature, _ however. While ose companies which have had it for me time say their experience with it is been satisfactory, others believe at the time has been too short to give reliable indication of the eventual relt. Some fear that experience with the (CONTINUED ON LAST PA C E) F. P. Stanley has resigned as vice president and general manager of the Glens Falls Indemnity and has been elected vice-president and superintend ent of agents of the Lloyds Insurance Company. This announcement was made by Julius H. Barnes, chairman of the board of Lloyds. He is assuming his duties immediately. Mr. Stanley has been with the Glens Falls Indemnity for the last five years. P. P. STANLEY Previous to that he was vice-president and superintendent of agents of the Nor wich Onion Indemnity. He was edu cated at Cornell and the University of Michigan. He started in insurance with the Travelers at its head office and was at one time in charge of the company training school for agents. R. F. C. October Loans The Southern Fidelity & Surety of Durham, N. C., is the only casualty company to receive authorization for a Reconstruction Finance Corporation loan in October. Loans were granted to seven life insurance companies. There were no fire companies on the list. Au thorization of $5,000 was made to the Southern Fidelity & Surety but it had not been called for up to Nov. 14. Capital Cut Proposed Capital of the First Reinsurance of Hartford will be reduced from $800,000 to $500,000 by canceling a sufficient number of outstanding shares. The dif ference of $300,000 will be transferred to surplus. The First Reinsurance is a member of the Rossia group and except for qaulifying shares, it is owned com pletely by Rossia International. ' " ' MICHIGAN FILING F I R S T Modifications Provided Where Hazard Is Covered by State Laws or Com mission Rulings The first filing of a new occupational disease program worked out by the Na tional Council on Compensation Insur ance, which is to become effective Dec. 31 in all non-regulated states, has been made by the council in Michigan. The new Michigan schedule also includes a flat increase of 16.9 percent over com pensation rates now in effect in that state and a further slight increase to cover occupational disease claims aris ing under Clause B l of the standard workmen's compensation policy. The occupational disease program is 'v> something entirely new in casualty in- ; surance. It comes as the result of long study by committees of the National Council. The chief diseases occurring in the course of work are named in a schedule. They are silicosis, asbestosis, lead, chrome, anthrax, benzol,' mercury, caisson disease, radio-active substance, and diseases not otherwise classified. I Increase Based on H azard J The average increase for occupational disease claims is distributed among var ious classifications in accordance with the hazard found in each. Accompany ing the filing is an exhibit showing the classifications of the corresponding oc cupational disease hazard weight in de termining the specific loading. For the classifications included in the list there is a basic occupational disease loading of X cent per unit of hazard weight. For all other classifications 1 cent has been added to the rate as heretofore deter mined. The revised rates and minimum premiums are to be applied to all new and renewal policies issued in all non regulated states to be effective on and after Dec. 31. M odification* fo r S tate Law * The hazard rates begin with 2 and run to 100. In the highest bracket is flint or spar grinding; silica grinding.. Silicosis is given as the occupational dis ease. Other very high weight hazards are stone cutting and polishing, where the hazard rate is 90. Red or white lead manufacturing, where lead poison-' ing is incidental, has a rating of 72. Dry battery manufacturing is placed in the lowest brackets of hazard weight. It, has^ a weight of 2. Lead poisoning is incidental to this work. However, there. '< are batteries made without lead, and for I (CONTINUED ON LAST PAG E) 32 CASUALTY THE NATIONAL UNDERWRITER Glass Rates Go Up For Chicago Dec. 1 (CONTINUED FROM PAGE 23) The penalty zone, or zone 1, in Cook county has been revised. Ashland and Western avenues, between Lake street and N orth Avenue, have been taken out of zone 1 because of widening of street. Cottage Grove, from 8,600 to 3,100, is placed in the penalty zone, as are 16th street from Kedzie avenue to Crawford avenue; Root street from State street to 600 west; Halsted from North ave nue to 24th street, 47th street from 37 east to 200 west, Archer avenue from 2470 to 2497, State street from 600 to 1200 south, and Lake street from 2400 to 2569 west. The principal reason for the increase was malicious breakage, which has been a cause of heavy loss to companies op erating in Chicago. The second rea son, however, was that there has been no increase in plate glass insurance rates in Chicago since the price of glass went up 25 percent in August, 1931. H eavy D osses E xperienced The companies loss ratios have been terrific in Chicago, one member of the bureau showing well over 93.3 percent on an earned basis and many others being in that neighborhood. The losses have eased up a trifle recently, however. The loss experience for 1931 was 58.3 percent or an excess of 18 points of the ratio upon which the rates in force were predicated. _ The zoning arrangement in Chicago is continued, with, however, some changes. Cook county is divided in two zones, zone 1 including a number of named streets, Chicago Heights and all territory east of the Chicago and East ern Illinois railroad; zone 2 embracing the balance of the county. Rates in Zone 1 for plates less than 50 square feet, will be figured upon a discount of 20 percent; lights of 50 square^ feet or more receiving a 15 per cent discount. In Zone 2 the discounts will be 55 percent and 45 percent, re spectively. . The destruction of plate glass fronts in Chicago for many months, much of it freely charged to a "racket," and bad competitive conditions led to organiza tion of the bureau there in June. A company committee headed by George Wilkinson, of the Commercial Casualty of Newark, was named to cooperate with Chicago managers and general agents who proposed the bureau. J. A. Law ler is secretary and administrative of ficer. Membership in the body includes virtually all companies writing plate glass in the territory. The changes are credited largely to the work of H. S. Slipner, assistant manager Bankers Indemnity; L. A. Krafft, secretary New Century Casualty, and J. W. Johnson, of W. A. Alexander & Co., representing the Fidelity & Cas ualty, members Chicago rating com mittee. Within the_ past few months plate glass rate revisions were also enforced in Cleveland, O., Tampa and St. Peters burg, Fla., and throughout Arizona. More recently, and likewise as a re sult of adverse loss experience, rates for coverage on private passenger automo biles in Mississippi, Louisiana and Ark ansas, were fixed at $6.25 for open cars and $12.50 for closed machines. All, changes noted above were based on the combined experience of company mem bers of the National bureau and those subscribing to the Moore rating serv ice of New York. The New Amsterdam Casualty has just signed up with the Chicago Bu reau. N ew Occupational Disease Plan Out (CONTINUED FROM PAG E 23) such as these it is stated no extra pre mium charge can be made. The program recommended is divided to meet the various requirements of the several state compensation laws as re spects occupational diseases. There are modifications, for instance, in states where occupational disease coverage is provided by the state compensation act or by court interpretations. In states where occupational disease coverage is not provided b y the state compensation act, or by court interpretations, there are new schedules, and in those states N ational.Inspection Company Incorporated I03 This corporation reports on the underwriting aspects of heavy manufac turing and mercantile properties throughout the following states : Michigan Wisconsin Minnesota Ohio Indiana Illinois Iowa Nebraska Missouri Kansas Kentucky Tennessee Oklahoma West Virginia Managed by j . a HubheU H. B. Chrissinger 17 W et A dam s S t* C hicago, m . R. L. Thiele J Reductionin Rates Hotel Blackhawk 04vnpo*'tl lows NEW LOW rates In effect NOW! At famous Black Hawk Hotels in Iowa and Minnesota. Service unsur passed. Over 100% more minimum rate rooms at these new low rates. No waiting or inconvenience Is securing: desired accommodations. Rates for an extra truest reduced to $1.00. Tastefully prepared food served in charming, friendly coffee shops and dining rooms at prices adjusted downward in tune with the timee. NEXT TIM E In Iowa or Minnesota--stop at a Black Hawk Hotel. Minimum rates at our hotels now range from $1.50 to $2.50. Lower traveling costs mean less expense in your sales departments. Hotel HaMbrd HisonCity. Iowa Hotel Saint foul St. Paul, Minn. where the occupational disease coverage is provided by the state compensation act, there are other modifications. In each of these there is some slight varia tion to meet the existing situation. Filings for regulated states will fol low the usual course and await decision to be made after hearings before the supervisory authorities. In the new Michigan filing the com panies do not ask for a graduation in rates by size of risk because of the re cent decision of the Michigan anti-dis crimination commission. This does not mean that the stock companies have abandoned the idea but they feel the need for increased rates in Michigan is too_ imperative to permit withholding their introduction pending the pursu ance of legal proceedings to test the va lidity of the anti-discrimination com mission's decision. n, In justifying the application for the new compensation rates, the National Bureau of Casualty ik Surety Under writers stated that every penny of the increase is needed by stock casualty companies to meet their expected losses .and expenses. "As will be shown in subsequent statements," the memoran dum says, "there is more danger that the increase will prove to be insufficient than there is that it will prove to be excessive." A loss ratio exhibit accom panies the statement, tending to prove that the increase asked for is conserva tive. ,,__ / Convert Many Old A. & H. Policies to Newer Forms (CONTINUED FROM PAGE 23) medical reimbursement form will grow to be like that with workmen's com pensation, which has been growing steadily worse and which has cost the companies many millions of dollars. They point to the possibilities of ma lingering, fee-splitting, and the padding of bills to which the medical rider would lend itself in unscrupulous hands, once the public and' the doctors become edu cated to its potentialities. They hope that a large share of these evils can be averted by extremely care ful underwriting- and a watchfuj check on claims made under the medical re imbursement provision. Some under writers hope that the public's favorable reception of the medical rider will mean that insureds will use discretion jn mak ing claims and be unwilling to risk can cellation by gouging the companies with exorbitant claims. Brokers Concerned Over Suit Involving Commission (C O N TIN U ED FRO M P A G E B) ment on workmen's compensation be tween companies and general agents. The Travelers, it is understood, applies such a rule, but when it takes charge to collect premiums after the grace pe riod it notifies the producer. The prac tice generally affects agents as well as brokers. Mr. Redmond states he was not notified, but instead the company notified only the assured. The Chicago Brokers Association is watching the case closely and if a decision is rendered adverse to Mr. Redmond undoubtedly will make an issue of the case and carry it to a higher court. _ The other case reported in T he N ational U nderwriter was that involv ing C. E. Nolan, prominent brokers' association member, and of the firm of George F. Brown & Co. of Chicago. The company made a payroll audit and notified the broker that it would collect direct but Mr. Nolan sent a notice he would expect that his commission be paid. The assured refused to recognize the company and would pay only Mr. Nolan. It was necessary to take the assured's notes, which were made di rect to the company and were not en dorsed by Mr. Nolan or his firm. The first note was paid in full and commis sion was allowed; then the assured faie< conn ing mitin Ma or conn sold Fire sold 33,00 mcnl man the amot amoi $1,00 T1 cago menl issue Corp in tl paid unde shari agen of tl sue nois, only It the i com; On show amoi coun senti stocl surp were Insu man; seem man; itself Oi was the . prox tion first third Busl in 1 $ 19.5 Fede pare throshov M on ' i date He was Nov the Grec Busl At for & Si scho duce anne ited held A. I tor scho has prev sion I Su May Cast ing i of Stan in It offici ager dent