Middletown transcript., 1886-03-26
TcoMMUNICAFED.I

owing month. For twenty years it had
pany. In May 1861, q supplement to its
charter was passed authorizing IT to do
business on the cash plan as we'll, and was
made stock, as we'll as mutual company.
1t was represented by Louis P. Buck OF
Wilmington, Del, as its general agent for
Delaware. Mr.. Buck being sanguine OF
the strength OF the company, aad of the
| (seeming) cheapness of its rates, on the
mutual plan, canvassed the state, and ap-
pointed several agents throughout the
state to cooperate with him. AS stated
the Insurance. was taken on the mutual
plan that OF multiplying the gross insur.
ance intended to be effected by the property
by certain number, according to the
greater or less degree of hazard, to form
a note. This formed the amount OF the
note. Upon the amount of the note, the
assessment No. came, which was per
cent. in this vicinity, which was intended
to carry the insured Tor one year, unless
some unforeseen fire, or other cause,
should make them increase the assess
ment, and which per cent. the general
agents, and the generals at Muncy, Pa,
gave the local agents to understand would
not be increased for the first year, and in
| structed that in all human probability it
would be much less each succeeding year,
this instruction to the uninitated local
agent was given him to pour forth, as an
extra inducement for property owners to
| insure in the Lycoming.
1t was not represented here many weeks
before the local agent here in Middletown
began to see there was something rotten
| in Muncy. He at once wrote to the gen.
eral agent, of 1t. and between the agent at
Middletown, and the general agent at
Wilmington the rottenness of the Com
pany was exposed to the unsuspecting
property owners of this neighborhood,
| and throughout the state, not only not
to take more insurance in the .Lycoming,
| but to refuse to pay any assessments,
hereafter; that the Company had ceased
to be an Insurance Company, either mu-
tual or stock and was ruled out of existence
by the Insurance Commissioners of the
State of Pennsylvania. -..--
A handful of selfcon stituted officials of
the defunct Company got together, and
for selfaggrandisemen elected a Receiver;
any other neighborhood where there were
Lycoming policy holders, bogus as they
were, could with just as much propriety
appoint Receiver, and proceed, and say,
and claim that so and so, policy holders,
owed thsna 80 per cent. IS per cent. so per
cent. or 100 per cent. on the notes which
happened to be held at the insolvent Of
flee of the out of existence Lycoming In
surance Company of that little interior
town of Muncy, Lycoming County, Pa.
Now brifiy let US note the condition of
tI,js broken up Company, as set forth by
the Insurance Commissioners of Pennysl-
vania. and the North American of Phila-
delphia in 1880.
The company then branehed out INTO an
extensive agen cy business all oyer tne
cSs4tTy eSs cScso and all saS loss Of half mil
lion, From that time the company was re,
garded with suspicion ~ the oonsef .o snor
State insurance departmen ,ss in Massachu-
setts. They still continued to !. however
ness elsewhere in the United Statest as noG
ana 1T the beginning n ne Of Il the s sf Il New
York But all this business had been sto@Sf nf
at a heavy loss all of which, by the terms .,
mutual insurers. Exactly how much the /
company lost on its cash insurance 1t would
be difficult to say, but special committee OF |
cation on the l4th, 18th and 18th of the cur |
rent month, made a calculation OF the re
suits from the 1st of January, 1873,
that the gross premiums received dur.
ing those five years for cash risks amounted
to So, ,469 1856, out of which was paid for refund
ed premiums, reinsurance, commissions
and brokerage, adjusting losses, general ex-
penses and salaries, 81, ,l47 ,51 leaving $i,SN,-
765 as the net income from cash policies.
But the loss on cash policies during the nve
wears was 81 553, ,27O, making the actual loss to
the company on the business SzSl, ,50o, OF
about $4,000 year, all Of which mad 70 De
holders. or course there was only one
termination to such method of doing bust
ness. The close Of the year 1879 found the
officers doctored their statement SO as TO
show a surplus of $54 ,462, though even upon
that showing the net amount inc oI nre
miums, was greater than the casn assets.
The first question of the examining COM
mittee OF the policy.holders o. Centre o1 county 10y
the 31st OF December last INCLUDED lhe ouI,
standing acceptances, ana they were tolu
frankIv admitted that outstanding accep-
tances to an amount three times as great as
the nominal surplus had been suppressed,
been included In the statement the company
would at once have been shut out OF every
state in the Union. Therefore say Inc
nnmmifteG.
correct and unreliable SO far as it purports
to show the Liabilities OF the company on thaI
day" The committee found, on tne aSt 0t9er fe,.
hand, that, allowing the company credlt Ior
oil the assets in hand available tor the pay
mept of debts and losses. 1t was Vas So SUI m IN
arrears on the 1st OF Jaaaady Sasg,ooS Iossas IN
cnryed aimee. amounting, on the l4th Of July,
TO e25i 6sg the cash policies IN the state OF
New York re-insured since IN Iaa. ualve hal.
anees SseA making a total deficit on tne l4Gn
Of Juiy ofS49l 244 In this total no auoWance
has been made for future losses OF e&Pnn, P,.ocess
that has beeR stea Oily going on, ana VIII
cost about 1885,, 900 more. To meet tnis IneTe
net premiums s1ced nf ibe ne ts assess %
nent of % cent esI S73 and of two succeed
ing assessments of 25 3 cent, estimatea at
S3f6, ,s75 when collected pom suGn he s91w tbnt
the committee recommends 20 the cioslng up
of the company's affairs as quicKty ana as
economically as possible pL sveIty epe VIZ
feel it due to them (the ofheiaisl 70 say inat
we found nothing which indica teo anytnlng
improper or erroneous In a 1e be Sei ieVe them to
he men of integrity, we cannot Dut cohueinn
their action in concealing the true conoiIlon
IF the company's affairs in their annuai
,.anorts to the Insurance department" The
highest salary paid to the omcers OF Inls re.
markable company was $oOOOto the assissanC LAM
cents on each policy, while the treasurer was
maid 5000. and eight clerks an average OF less
than $500. The president received the mum,
ficent sum of $780, from which 1t Is presum
that he was not required to know much
about sii.oS the company The company had in
at the Of the ysar Flss ss
o,,s Ino o, aSSh risks 10 meet these on February
" Meti the % Company had assets amounting to
against which shere I we're we're nr Maolses osses
oirSoI, vi cd, incnrred. Then came the Milton
Are iiI which the company lost $4,000, and
another statement was presented 70 Inc
Roard of Directsrs showing assets OF SiO5,-
$50 oF witch es6 436 were assessments collect
aTie the cash assets being less than $4,000;
AGAINST this were s5os, 40 Of losses due ana
a. a. PodditIon to Sll56 miscellaneous bills mn
Maid ms A meeting of the mutual policy
holders has been called for the 6th OF AEugusI, E
osnfy a. Sn at which there is likely to be some
VerV 1iain talk about this method OF DONG
buSinesS. -