Bad News from Seattle

When the Narrows bridge at Tacoma.

Wash, crashed last month (TIME. Nov. 18), one insurance firm that took only a bystander's interest was careful, conservative Merchants Fire Assurance Corp. of New York, whose files held no direct policies on the $6,400,000 wreck. Officers were still congratulating themselves when -- two days after the bridge collapsed -- startling news arrived at the company's branch office in San Francisco.

The news started as a rumor: another insurance man called the office, said: "I hear you people are on the bridge for $800.000." Soon an envelope arrived, turned the rumor into fact. In the envelope were copies of policies for $800,000, written on the bridge by the company's Seattle agent in July but never reported to the firm.

Merchants' Seattle agent (for 20 years) was Hallett R. French, one of the best-dressed members of the city's best circles. French had decided the Narrows bridge was a good bet. booked it himself. Arrested last week on a grand larceny charge, he admitted he had kept the policies secret from his company, kept some $8,000 in premiums to apply on a personal budget which included fat sums for social clubs, a new home on Seattle's swank Broadmoor Drive, frequent visits to nearby Longacres race track. After investigation, a Seattle prosecutor concluded that high-living Hal French had held out other policies too, pocketed perhaps as much as $70,000.

Under the law of agency. Merchants (assets $17,500,000) is bound to honor the bridge policies. Although its own catastrophe insurance will hold down its loss. Merchants expects it may have to pay out as much as $200,000, thus become the first U. S. insurance firm to be nicked for anywhere near that amount (on a single risk) by an agent's dishonesty. Said Merchants' Secretary Walter F. Brady: "Never by any stretch of the imagination would our company have carried insurance to that amount [$800,000] on a bridge."

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