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--. FEDERAL RESERVE BOARD WASHINGTON February 6 1 1922. X-3324 SUBJECT: Letter from Federal Reserve aank of Boston RegarQing Insurance on Juilding Dear Sir: There is transmitted herewithJ for your information, copy of a letter from tne Governor of the Federal Reserve Bank of Boston regarding the insurance on the new building of t.r1at Bank. Yours very trulyJ (El:closure) G o v e r n o r. ) GOVERNORS ALL F.R.BANKS EXCEPT 30STON '~ :---· ~ _:....,i'__ .,'t....V . _, -·' ---r ... _;_,_~ ) c 0 p y FEDERPL RESERVE BANK OF BOSTON X-3324a February 2, 1922. Mr. W. P. G. Harding1 Governor, Federal Reserve Board, Washington1 D. C. Dear Governor Harding: I have just completed our final arrangements with the insurance companies as to the rate of insurance on our nev1 bank building. and I thought that the Beard might be interested to knew what that rate was and what the insurance will cost us per year, especially as the Board of UnderNriters state that the rate they have issued on our bank building. is the lowest rate they have ever r,ut out. The basic rate is 9· 6 cents per hundred dollars on an 80 per c_ent co-insurance clause which makes an allowance for the value of the foundations, By taking the .insurance policies for five years, we get a five-year insurance at four times the rate for one year. The result is that a five-year policy costs us 33.4 cents per hundred dollars, and on $2, 8001 000 comes to $101 752 premium for the five years or $2150.40 for one year. Since the time that the building was started, vwe have been in communication with the insurance people and tc,l-i them that we would insure the building if the rate was so lovi that we could not afford to do anything else, but unless we had a good rate we should prefer to set aside a fund to insure it ourselves. It seems to me that this charge per year for insurance on the building of $2150.40 on $2,600~000 is so low that He cannot afford to insure the building in any other way, and as I say 1 I thought you would be interested to know the reresults of our efforts in this direction. ) Of courses we have followed the regulations required by the insurance companies and have done everything to prevent a fire in the building or at least to localize it I but we considered that their . regulations and their experience was so good that we could not afford to do any differently from what they recommended in any event. As a result of their recorr~endation we nave sprinklers in the basement} certain fire partitions and fire doors and all exterior glass is wire glass and. :r.etal frame windows... and eac:--1 window Das tvvo or three mullions in it which divide the panes into comparatively swall pieces and this together with the wire is expected to prevent any fire getting inside the building in case a neighboring building was burn~d. -2- X- 3324 a Tfieseregulations are applied to factory buildings and therE) is much experience to show that they are effective. I would add that we have been insured by the best stock in Boston~ not the same as if we were insured in mutual comnanies where 'v'le would be subject to additional premiwn in case of loss in some other plant • c~mpanies .Also, when we finally occupy the building even this rate will be cut slightly because we have watchmen in the building 24 hours of the day, and still another reduction about June or July when the high pressure service in Boston goes into effect. Very truly yours, (Signed) Charles A. Morss, Governor. ......_"'--' '' '•
@FedFRASER