L*a| ln#liVttMAA nOvl IRIIlllRuV Topic Discussed The following article Is being S reprinted from the Open Forum ij column of The Charlotte Observ er, issue o< December S, 1948:' • ~ SCHOOL INSURANCE . To The Observer: ' On October 1, 1948, The Dur t ham Sun published an v editorial criticising the 'Insurance depart ment of this state for approving a 25 percent increase in fire in surance rates on public schools. The editorial failed to state that the Increase does not apply to buildings of superior construction —generally known as 'fire-proof structures, and eprinklered prop erties. The Sun editorial also stated that during the last 10 years the fire insurance companies, operat ing in North Carolina, collected premiums on public school prop Just received shipment MAYTAG WASHING MACHINES Come and Select Yours now. $. V. TOMLINSON North Wilkesoro, N.C. ej-tiee amounting to $4,500,000 and during the same period paid losses of $2,800,000,and such a refcord "would seem to be profit enough on public schoolB to per mit the insurance companies to operate comfortable". The state ment quoted above is evidently intended to convey to the public the idea that the difference be tween premiums collected and losses paid equal profits. But this is not true: The fire insur ance companies, like all other businesses, have to pay, expenses and taxes. Furthermore, the premiums given in The Durham Sun edi torial do not present a true pic ture, because losses must be cal culated on earned premiums rath er than on premiums written, if we are to reach a sound result of operations. We believe it is fair and liberal to assume that not more than 75 per cent of the three and five-year premiums under the policies in force have been earned. On that basis the ac tual premiums would be reduced to 13,375,OOO.wlth losses paid of $2,800,000, or a loss ratio of 80 per cent with premium expenses of 40 per cent. During the last eight or ten years, as a result of greatly in creased values, the amount of fire insurance on practically all schools has been materially in creased, with the great mapority of coverages written for terms of three and five years, with pre miums paid *n advance. (The three and five-year term prem iums produce a savings to the schools of about 15 per cent and 20 per cent respectively). There NOTICE! NOTICE! ro Taxpayers of the Town of Wilkesboro: Jeginning February 2, 1949, penalty will be added to all unpaid taxes due the town of Wilkesboro for the year 1948. Pay now and save the penalty. J. R. HENDERSON Town Clerk and Tax Collector. FREE '5.00 TO ANYONE * • Fill in the space below of a friend or neigh bor who is a prospect for a piano. If we sell them, you will receive $5.00. Prospects Name Address Your Name 1 Address KLUTTZ MUSIC COMPANY Granite Quarry, N. C. MILLERS CREEK THEATRE PROGRAM \ Friday, January 21 "SISTER KENNY" "Polio Drive" Starring Rpslyn Russell. Also: Western Welcome and Ain't Nature Grand. Saturday, January 22 UNCERTAIN FEELING" Starring'Merle Oberon and Melvin Douglas. Also "Spinich vs Hambergers" Sunday, January 23 ""THAT DARING YOUNG MAN" rrring Joe E. Brown. Also "The Big Flash" and "Snow Place Like Home." Two Shows Each Night. First Show Starts At m t 7:00 o'clock. Ii fore, the insurance companies continue to carry the liability and must pay all losses that will oc cur until the expiration of the three and five-year policies. Losses calculated on earned prem iums usually produce a loss ratio of about 40 per cent higher than the losses on premiums written and losses paid. If the existing policies should be canceled, for any reason, the unearned prem iums would have to be refund ed to the public schools and, in the meantime, losses continue to occur under the existing con tracts, all of which proves the correctness of calculating the loss ratio on an earned premium basis. The premiums presented by The Durham Sun produced a loss ratio of 62.22 per cent and the actual experience on public schools is tabulated as follows: Loss Ratio, Premiums writ ten and losses paid 62.22 Commissions to Agents for ' producing business and servicing policyholders 20.00 State Premium taxes 2.550 Firemen's Relief tax eft. .25 Rating Bureau, Licenses and fees 2.00 Company administration ex penses, salaries, rents, field expesses, supplies, etc . 13.00 Adjustment expenses 2.40 102.37 Firemen's Relief Tax is one half of 1 per cent, but I have used one-fourth of 1 per cent be cause approximately one-half of the schools are in protected a reas. The tabulated figures above show a loss on public schools and, in addition to that, the Insur ance Commissioners of all states agree that the insurance compa nies are entitled to at least 5 per cent underwriting profit, as well as some reserve for confla grations. The Insurance Department and the North Carolina Fire Insur ance Rating bureau «re making an earnest effort to rate all prop erties in this state by classes bas ed on experience. At the time our Commissioner of Insurance ap proved the increase in fire rates for public schools, there were many classes Up for consideration on the record of each class of property. The decreases approv ed by Commissioner of Insurance Hodges, on tenant dwellings and household furniture alone, a mounted to a greater savings to the public than the increase on public schools. The average rate in North Carolina is lower than it was before World War II. Do you know of anything else that is selling at a lower cost than be fore World War II? In the mean time, the fire insurance compa nies have met all of the increas ed cost of operations. After due /consideration of the record on public schools—ex cluding so-called fire-proof and sprinklered risks—the Commis sioner of Insurance agreed that the fire insurance companies would about break even with the increased rates, If losses continu ed as heretofore. If losses de crease over a reasonable period, rates will decrease on public schools and all other cdasses. It is definitely the obligation of all of us to help reduce the alarming fire waste in this state and the entire nation. P. W. D. JONES, Vice President, Piedmont Fire Insurance Company. Charlotte, North Carolina. o Singing January 30 Little Rock Church The Southside Singing Conven tion will be held Sunday, January 30, at Little Rock Baptist church, beginning at 11 a. m. Chairman F. J. McDuffie anounces that ev erybody is invited, especially all choirs, quartets, and other sing ers. Dinner will be spread picnic stylev at noon, therefore, Chair man McDuffie asks all to bring well-filled baskets. ADMINISTRATRIX NOTICE Having qualified as Administra trix, c. t. a., of the estate of Wiley Glenn Robbins of Wilkes county, North Carolina, this is to notify all persons holding claiihs against the estate of said deceased to present them to the undersigned within ;one year from date of this notiee or same will be pleaded in bar of their recovery. All persons owing said estate will please make im mediate settlement. « This 8th day of Dec., 1948. MRS. VALLIE BRANNOCK, Admrx. c. t. a. of Wiley Glenn Robbins, dec. Alexander & Neaves, Attorneys 2-3-6tT j ADMINISTRATRIX NOTICE Having qualified as administra trix of the estate of N. A. Wyatt, late of Wilkes county, North Caro lina, this is to notify all persons having claims against the estate of the deceased to present them to the undersigned before the 20th day of December, 1949, or this notice will be plead in bar of recov ery. All persons indebted to the estate will please make immediate settlement. This 20th day of Dec., 1948. MRS. N. A. WYATT, Admrx. estate of N. A. Wyatt, de

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