$5,000,000 Drop in Losses Reduces Premiums
As a direct result of the conviction of Samuel (“the Torch”) Skoblow, professional firebug, and his associates, and the breaking up of the arson ring through the efforts of Fire Marshal Brophy, of New York, drastic reductions were voted on October 11 at a meeting of the Rating Organization of the New York Fire Insurance Exchange. The new rate became effective at once and was retroactive on all policies in Brooklyn issued since August 1, 1935.
Prior to 1931 there had been a gradual increase in fire insurance premiums on merchandise in stores and household furniture in congested areas which are designated as the Williamsburg, Brownville, East New York and Coney Island districts, which was finally fixed on April 22, 1931, at an increase of 50 cents of each dollar of premium on this class of risks in these districts.
Fire losses in Brooklyn have dropped from about $8,000,000 in 1930 to the $3,000,000 level for this year.
Here are the figures:
* The Coney Island fire accounts for about $2,000,000 of the total loss in 1932.
In April of 1933 the Brooklyn Chamber of Commerce issued an alarming report on the Brooklyn arson industry, describing it as “the biggest racket in the city.” Two old line insurance companies had stopped writing policies here and high rates were being charged by those that would still place fire insurance.
This increase was discontinued by the order made on October 11, and amounts to a reduction of one-third of the premium. A merchant who carried insurance on $50,000 of merchandise was obliged, under the old order, to pay a premium of $1,000 a year. Under the new rates, effective as a result of the decreases in fire loses, the merchant will now save one-third of that premium, or $333.
Rates are correspondingly decreased in the districts mentioned. It is conservatively estimated that on the usual three-year policy residents and storekeepers of the sections named will effect a saving of almost $1,000,000.