August 2, 1919 



HORTICULTURE 



91 



LOSING INSURANCE MONEY BY 



DEPENDING TOO MUCH ON 



THE AGENT. 



A veteran insurance man, who is 

 good enough to commend some of 

 these articles for business people, said 

 to me the other day: "You couldn't do 

 better than write something about the 

 danger ol depending too much on an 

 insurance agent. The authority of all 

 Insurance) agents is sharply limited. 

 Some agents, for instance general 

 agents, can do more than a mere 

 BOliclting agent, and bind the > one 

 pany, but the authority of every 

 agent is limited somewhere, and if 

 they make some promise or some 

 agreement which goes beyond the 

 limit, it is void and the company is 

 not bound. The man who has relied 

 on such a promise or agreement may 

 lose all his insurance." 



As a matter of fact, while he was 

 speaking some illustrations occurred 

 to ni*s which had occurred under my 

 own observation. 



My experience is that the average 

 business man relies almost entirely 

 upon his insurance broker or agent to 

 keep him covered and safe. This is a 

 very risky business, and thousands of 

 dollars have been lost through it. If 

 the agent is not a general agent of the 

 company he cannot bind the company, 

 and even if he is a general agent, he 

 cannot always bind the company. 

 With insurance the only safe thing to 

 do is to depend on nobody, but to keep 

 after a given situation until you know 

 that the company has knowledge of it 

 and has passed upon it. 



For instance, in one case which I 

 know of, a man carried fire insurance 

 on his store and its contents. A fire 

 occurred at a busy season. He went 

 to his local insurance agent, through 

 whom he had placed the risk, and 

 said: "See here, this thing is upset- 

 ting my business at the biggest season 

 of the year. Can't you fix it up so 

 that I can go ahead and repair?" The 

 agent, accommodating like most local 

 agents, went around, sized up the 

 building, and said: "Go ahead and 

 make a contract with the builder: it'll 

 be all right." The owner therefore 

 went ahead and placed his contract 

 for repairs and reconstruction, spend- 

 ing considerable more money than he 

 would have spent had he expected it 

 would come from his own pocket. 



Later when he sent the bills to the 

 company it repudiated them and re- 

 fused to pay on the ground that he 

 had filed no proofs of loss, as required 

 by the policy, and that the agreement 

 made by the agent was not binding 

 on the company. Furthermore, the 

 company said it intended to contest 



the claim on the ground that the mer- 

 chant had persistently kept more 

 gasoline on the premises than he bad 

 any right to do under the policy, and 

 there was reason to believe that the 

 gasoline was at least partly responsi- 

 ble for the fire. 



The court ruled that the company's 

 position was sound; that the agent 

 had no right to bind the company with 

 such a promise as he made, and that 

 the company had a valid defense to 

 the claim under the gasoline clause. 



The merchant of course lost his in- 

 surance through double carelessness — 

 first, by keeping too much gasoline 

 without the company's consent, and 

 second, for taking the agent's word for 

 something that did not bind the com- 

 pany. 



I remember another case involving 

 the right of an insurance agent to ab- 

 solve the holder of a policy from fil- 

 ing proofs of loss. In this case there 

 was a fire and the local agent, who 

 had placed the risk went around and 

 satisfied himself that the fire had oc- 

 curred, also as to what the loss was. 

 The insured thought — and the agent 

 told him so, too— that it would be 

 superfluous to file proofs of loss, since 

 the company had had notice and its 

 representative had actually been there. 

 So he filed none within the time. The 

 company later refused to pay on that 

 ground and pointed to a clause in its 

 policy that "no officer or representa- 

 tive of this company shall under any 

 circumstances have power to waive 

 any provision of this policy, and any 

 attempt so to do shall be null and 

 void, and not binding on this com- 

 pany." Here, too, the company won. 



In a third case a local manufacturer 

 had gotten his fire insurance through 

 a local agent. The policy expired and 

 the manufacturer thought the renewal 

 rate too high. He protested and dick- 

 ered, the building being meanwhile 

 uncovered. Finally he went to the 

 agent's office and agreed to pay the 

 asked rate. The agent said: "All 

 right, I'll put it through right away 

 and send you a bill for the premium in 

 the usual way." The agent was sud- 

 denly called out of town that day and 

 did not put it through. Before he got 

 back a fire almost gutted the manufac- 

 turer's plant. He thought himself safe 

 until he came to look into it. The 

 company refused to pay on the ground 

 that there was no insurance on the 

 plant at time it burned. The manu- 

 facturer claimed that the arrangement 

 between himself and the agent con- 

 stituted a contract of insurance, and 

 the only reason he did not pay his 

 premium then was that for years the 

 agent had renewed his policies and 



sent him a bill for premiums after- 

 mi. The court said that the com- 

 pany didn't make this arrangement 

 and didn't agree to it, therefore it 

 wa: ii t bound. The cold fact was that 

 il had no policy on the plant at the 

 time it burned and had not been paid 

 for any. 



The loss here was so heavy that it 

 crippled the manufacturer for years. 

 He could have easily prevented it. 



There is a great difference between 

 the authority of a general agent of an 

 insurance company and that of an or- 

 dinary soliciting or local agent. Gen- 

 eral agents are authorized to accept 

 risks and issue policies by filling out 

 blank instruments which are placed in 

 their hands for that purpose. They 

 can also renew policies already issued, 

 and when they do all this they bind 

 the company. But the ordinary local 

 or soliciting agent merely has author- 

 ity to solicit insurance and submit ap- 

 plications to the company, or to a gen- 

 eral agent. He cannot bind the com- 

 pany by any attempted acts or con- 

 tracts in its behalf, not relating to the 

 taking of applications. 



The great difficulty you as the in- 

 sured are in, is that you are bound to 

 know pretty much what the agent's 

 authority is. Lots of things will get 

 by only so long as there isn't any fire. 

 (Copyright, July, 1919, by Elton J. 

 Buckley.) 



The Annual Meeting of 

 the Florists' Hail Associa- 

 tion of America will be 

 held in Arcadia Audito- 

 rium, Detroit, Michigan, 

 at 9 A. M. on Wednesday, 

 the 20th day of August, 



IQIQ. 



John G. Esler, Sec. 



^tmiHiimiimiuiiiiimiiiiiii 



iiiimiiiiiHiriiiiiiimiimiiiiiiiiiiiiimiiiiim 



INSTRUCTION IN GARDENING 



i Practical Instruction la offered In 

 | vegetable, flower and fruit gardening, 

 = greenhouse and nursery practice, to- 

 1 gether with lecture*, laboratory, field 

 = and shop work In garden botany, soo- 

 I logy, pathology, landscape design, soils, 

 i plant chemistry and related subject*. 



The curriculum la planned for th« 

 = education of any persons who would 

 | become trained gardeners or fitted to 

 I be superintendents of estates or parks. 

 I Students may be admitted at any time. 

 = Circulars and other information will 

 | be mailed on application. 



I The New York Botanical Garden 



| Bronx Park KIW TOIK OTTT 



'-•UH.IIIttlMMIIIIIIllllllllttllMUIIMllllltlUllliJIIttlltllllHMHJiUinilMkllMMttMIMI, 



When writing to advertisers kindly 

 mention HORTICULTURE 



