Long vessels are faster than shorter ones. Increasing the separation between the bow and stern wave reduces wave-making resistance more than any other design factor. For over a hundred years designers and Race Committees have grappled with methods of rating speed of a variety of sailing vessels and handicapping them fairly.
A rating rule can dictate a fixed level that no yacht is allowed to exceed. On the other hand, in the case of handicap racing, the ratings of big and small vessels can be converted to time allowances. Elapsed times are "corrected" with the winner declared after the handicaps are applied.
One of the earliest rating rules used in North America was the Seawanhaka Rule which originally rated length and sail area; two large speed factors. After a while, undesirable designs evolved and changes were made the Rule to tighten up on the type of vessel produced. Girths were measured at three places along the waterline and a complex formula converted all measurements to a rated length. Boats with fuller bows and sterns had higher potential speed than those with finer ends and were not allowed as much sail area to push the boat.
In the Northwest, in the early 20th century, the major event racing was done in gaff-rigged sloops built to rate 29 feet or less under the Seawanhaka Rule. No handicaps were applied to the race results; the first boat to finish won.
The girths were difficult to measure consistently and sharp designers, including Ted Geary, altered the hull shapes locally around these points to produce artificially long boats that still rated under 29'. Controversy followed and a simpler way was sought.
As early as 1901, the New York Yacht Club began soliciting suggestions for a simpler rule from the best designers of the time. The formal development of the Universal Rule was done by Nathaniel Greene Herreshoff and, when adopted by the N. Y. Y. C. in 1903, it immediately simplified the whole length rating process. Other clubs in North America adopted the rule over the next few years.
Instead of girths, the rule took a measurement of the waterline length at 25% of the maximum beam outboard of the centerline. This "quarter-beam" rule along with more explicit rules regarding hull and rig specifics produced some of the finest racing yachts ever designed in America. Herreshoff also wrote minimum construction standards, called "scantling rules" as part of the Rule that proved perfectly adequate. There are several R, Q and J boats sailing today thanks to the structure that Herreshoff required of them.
The various classes or "levels" were distinguished by letters. The R-class sloops rated 20' and the largest sloops, the I-class, rated 78' and were around a hundred and fifty feet long. Perhaps the most recognized Universal Rule yachts were the majestic J-boats that raced for the America's Cup in the 1920s and 30s.
The little S-boats rated 18 feet under the Rule and the Herreshoff S-boats on the east coast and the Pacific Coast S-class ("PC") are good examples of one-design (all identical) boats evolved from this rule.