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ate in obtaining the same information as readily as have those already mentioned.

Policies totalling close to $400,000 have been written, this amount comprising over 150 separate risks varying in amount from $200 to $5,000 each. A number of other tracts have recently been inspected and policies are in course of preparation.

88 per cent of the value covered comprises merchantable timber, 8 per cent. natural young growth, and the remaining 4 per cent plantations.

It can readily be seen that merchantable timber offers a large opportunity for salvage if in reasonable proximity to market, so that complete loss is rare. Young second growth, while more dangerous, does not run into money so fast, and plantations, while hazardous and easily a total loss, are generally in small units and usually receive considerable protection and care.

So far I have made no reference to the expense of doing business.

Under ordinary conditions, new companies are subject to a high expense ratio for several years, until they have obtained a large volume of business over which to distribute the overhead charges.

In this instance, many expenses have been eliminated. There have been no promotion or organization expenses charged to the company other than the charter and license fees.

Legal advice relative to incorporation, by-laws, policy and forms was given gratis. Office facilities, printing, and stationery have been provided free of charge. The treasurer and manager's salary and expenses have been privately assumed for the first year and the secretary has given his services to the Company free of charge.

The directors represent all of the largest timberland owners in New Hampshire. HOW CAN WE CO-OPERATE TO MUTUAL ADVANTAGE?

The Timber Lands Mutual Fire Insurance Company was formed by owners actively engaged in promoting forest protection, to provide compensation for fire losses in standing timber and young growth on a cost basis.

It desires to extend these facilities to you believing you will derive benefit therefrom, as will the Company, in that your risk will be distributed over ours and vice versa, a larger volume of business will be written giving a wider distribution of risks and result in a more uniform loss ratio.

Volume of business (by which I mean good business) governs



to a large extent the eventual net cost, for it costs very little more to write $5,000,000 of insurance than it does to write $1,000,000.

The total volume of business also influences the amount which can be conservatively written on a single risk, as this amount should not exceed 10 per cent. of the assets which, apart from the guaranty capital, are largely made up of its premium income. A large number of small risks constantly accumulating will eventually permit larger lines being written.

In addition to the insurance you may wish to obtain we desire that you take an active part in the Company's administration by having representatives on its board of directors and by taking over a portion of its guaranty capital. The proceeds of any portion of the guaranty capital stock so transferred will be placed with the funds of the Company, thereby increasing its stability.

The idea at the root of all plans for insurance is mutual help, and the opportunity is before us to establish an organization which in time may extend its usefulness to all the timber States of the country.

POSSIBILITIES OF TIMBERLAND INSURANCE First-Comnensetion for loss at reasonable rates, which has never before been offered.

Second—A stimulant to adequate protection, as policies will not be written or will be voided, unless a reasonable amount of state or individual protection is assured.

Third-Encouragement to hold growing lands and to make plantations with the assurance that money invested in them cannot be suddenly wiped out; the creation of a value for purchase or sale of young growing timber.

Fourth—The liquidation of capital. In the past some banks have been unwilling to accept standing timber as collateral for loans, while others have only loaned a small portion of the value. It has been found that banks will now accept insured timberland as security in the same manner as other insured property, and will advance a much larger amount than hitherto has been their custom. This money can be put to work and earn for the owner probably more than 1 per cent. over bank interest, so that if the net cost of insurance is about 1 per cent. it will not only be paid for, but an additional amount be left as profit.

Should this insurance company grow to a size which will enable the amount written on the individual risk to be much greater, it will be possible for the owner to borrow large sums directly instead of through the medium of the bond issue, and the timberland owner

will then have a simple and easy means of liquidating the capital invested.

Such a Company will be a public benefit and has before it an unlimited field of expansion throughout the United States. (Applause.)

A REMAFKABLE OPPORTUNITY THE PRESIDENT: I hope there is not a man here but appreciates the significance and importance of this paper that has just been read. This is the first time the woodland owners in this State have had opportunity to consider in concrete form a proposition for the insurance of their standing timber. I think we owe a debt of gratitude and respect to Mr. Brown and his colleagues who have put into operation this plan to afford us mutual timberland co-operative insurance. I know that some of our large New York State landowners are considering with seriousness the plan that Mr. Brown has outlined and which is in operation in New Hampshire.

Our first impulse has been to co-operate with them. I suggested that co-operation in a letter to Colonel Brown some time ago--a year or more ago.—but at that time they were not prepared to consider New York State woodlands. The precise reason for that was not stated, but I suspected that it had something to do with the insurance laws of the State, or possibly that it was on account of a lack of browledge of our fire protection system and of our woodland values

MR. DE CARTERET: Excuse me a moment, Mr. President. I think also it was due to a feeling of diffidence on the part of Mr. Brov'n ard the others to biting off more than they could chew perhaps.

The FRESIDENT: A very commendable state of mind, that is.

So the opportunity is really here, and it is one that we may have to make use of sooner or later, one that we will be glad to make use of sooner or later in New York State.

Is there anyone who would like to discuss this paper on the subject of mutual fire insurance of timberlands? Is so, we will be glad to hear from them.

A SPEAKER: Is this the first company in the United States, of this sort ?

FIFST COMPANY OF ITS KIND MR. DE CARTERET: It is the first mutual company which has been formed for the purpose of writing standing timber insurance. The "Fhoenix" of London is the only one which is making a busi

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