Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1870-07-05
INSURANCE.

lAAAlh t46I0 dIo 6OAll6 SIIOrS COutalnoO
therein-no doubt unintentional-which
require correction. Although published
sditoriaIly, suppose the items on which
it is based were furnished by some person
who had more knowledge of the history
of the Company than you were likely to
have obtained.
The old Tennessee Marine and Fire In
surance Company" was the first Insurance
Company chartered by this State. Ths
names Of the officers from the beginning to
the end of its charter are correctly given,
and in the order of their appointment.
The article, however, contains very i'm
portant error, in stating that 'sthe original
charter continued for thirty years The
entered on the duties of Sec
Rotary IN April, 1851, subsequently, be-
came President when A. w. Butler was
Secretary. In the fall OF that
neutrality-suspicious. was made to the
Legislature for very important alterations
to the original charter, all of which were
granted, including reduction of its capt.
tai stock to $3.50, 600. Had the Com
papy ceased to do business in April, 1881,
or perhaps eighteen months thereafter,
and settled up its affairs, the stockholders
would undoubtedly have been compelled
TO have paid part of their stock notes to
liquidate los'es sustained chiefly at its
agencies. These stock notes had been
running from the first organization OF the
Company, but reduced in amount from
time to time, by dividends passed to their
credit. In 1851, they amounted to
S13S, 600, and remained about that
amount for some time thereafter.
On the 1st of April, 1857, how
ever, the success of the company hsd
been such, as to enable the Board Of Di-
reetors, not only to surrender the stock
notes 20 the stockholders, but at the same
time paid them a cash dividend of So per
share. So late as August, 1852, the conn
pany was indebted to the banks for money
borrowed to pay losses, the sum Of S27,-
600; and if / recollcet Alright, the amount
thus borrowed at one time reached thesu
of $4,000 or upwards. In April, 1851, the
company had five agencies, viz: at St
Louis, Philadelphia, Boston, New Orleans
and Clarksville. The one located IN New
York had been withdrawn ashort time prior
tosthe date Just mentioned. The lossessus-
tanned by these agencies were very heavy,
especially by those at st. Louis and Boston.
months longer, and Deen permitted to take
such risks as they had been taking, the re-
suit TO the company would have been discs
trous. They were all, however, speedily
Withdrawn, with the exception of the little
agency at GAINESVILLE, which had been and
continued thereafter to be conducted with
marked ability and prudence by the Hon.
d. N. Kennedy. / will remark, however,
that in the latter part of April or in May,
1851, an agency was established at Men,
phis; but instead of allowing the agent ten
per centUm on the gross amount of pre-
miums-(the compensation which believe
had been invariably allowed to the agents
of insurance companies here)-he was re-
quired by agreement to look for his gains
10 the successful management Of his agen-
cy. Founded on this Just and equitable
basis, the agency there became an import
ant auxiliary in replenishing the Golfers Of
the parent Office
The article In question states the aver
age annual dividends paid during the
thirty years gifts charter, was thirteen and
one halt per centum.
Now think it hardly doing justice TO
those who had the control of the affairs of
the company, during the latter part of its
existonce-the only period of its real sue
cess-to throw together the aggregate
profits of the whole term of its chartered
life, and divide the sum total by thirty, and
thus show what had been the average year
" gain, without at the same time stating
what period Of its history the greater
amount of profits had been realized. What
are the facts: Why, from the LIST Of jan
nary, 1884, to the LIST of April, 1851, pc
Rod of seventeen years and three months
say for seventeen years only-the divi-
dends paid In cash and to the credit of
stock notes, was equal only to a little up
wards of five and one-half 90 per cent
per annUm on the amount of the capital
stock of the company; while from April,
1851, to April, 1862, period of elsven
years, (l1, it paid dividends to an amount
up to that time. and subsequently, equal
to thirty-siz (3G) per centum per annum on
its capital stock. This includes three dol
lars per share (it will probably be more)
yet to receive from the assets of the COM
pauy. After April, 1862, owing to the
blighting effects of the war, there was little
business DONE. and soon thereafter. no
risks were taken. Strictly speaking the
active business Of the company ceased
with the breaking out of the war in April,
1861. It's business from that time became
more and more paralyzed, until it ceased
altogether. / make the calculation of
profit, or interest on the amount of
the capital stock Of the company, up to
April, 1862, because the profits ON the small
amount of hazards taken after that time,
was not probably more than adequate to
the payment Of the current expenses of the
company. l assume, therefore, that all
the gains had been made prior to that
time. Had we been blessed with peacs,
regard it as more than probable that
the average annual per centum of
gain from April, 1851, to the termination
of the charter on the first of January, 1864,
would have been upwards of forty (40) per
cent on the capital stock. About the be-
ginning Of the war, the Company had an
absolute surplus of about $50, 200, besides
the sum of $37, 900 set aside for the pro-
lection of risks, not earned; making TO
gsther a gross surplus of about 1898, 600.
a large portion of this fund was swept
away by the results of the war. 1t was the
policy of the Company to add to the sur
plus fund until it amounted to at least
100000, Independent of the fund pro-
vided for the protection of outstanding
hazards. These two amounts added TO the
capital stock Of the Company, could have
been invested so as to have yielded ten or
twelve per centun on its capital, exclusive
of the profits 70 be derived from fire, ma
rine and river risks, which had for many
years prior to the war resulted in 8 success
almost unparalleled in the insurance line.
This large surplus Of $780, 900 could have
been realized, If was confidently believed
Gudging from our past success, within
two or three years; and within the mean
time have declared dividends probably Of
from twenty to thirty per cent per annum
on the capital. The bhghting effects of
the war, however, soon came on and put a
stop TO our well grounded anticipations of
a brilliant future for the interests Of the
Stockholders. Application would have
been made TO the Legislature in the fall of
1861 for a renewal of its charter, with GER
tain amendments thereto; but the war hav-
ing commenced, it could not be done, and
the Company ceased to exist with the
termination Of It's charter
JOSEPH YAULx
NASHVILLE, June %, 1870.
Agricultural
There viii be a meeting of the Directors