Pittsburg dispatch. [volume] (Pittsburg [Pa.]) 1880-1923, 1889-02-23
Total paid policy
.s5.SS5.saS 3s

Profit and loss. S5i,527 6
Total expenditure. So 6s9, l44 g
Leaving a balance Of 1924, ,33l 80 to bt
carried to increase net or ledger assets.
MORTALITY.
The death losses for the year were some
what above our average experience, but
were so far inside the mortality to be ex'
pected by the table and provided for by oul
premiums as to leave a saving of about
$3.50. 600. For two years the death rate has
been above our average. But even at Its
highest it has been far below the mortality
table, proving at once the careful selection
OF our business and the abundant safety Of
the table on which our operations are based.
Our losses have been paid with equal re-
gard to the prompt satisfaction of every just
claim, and to the protection of the honest
members against every unjust claim.
EXPENSES.
We still follow the principle that when a
company has reached any considerable size,
not only is it better for both old and new
members that new business should be taken
only at such price as does not reduce the
dividends on the old, but that there should
be general tendency to 4 reduction in the
expense ratio to offset the mountaineering
ever is got in violation of this principle is
q source of ultimate weakness and not OF
strength, whatever its magnitude. 1t is 4
great satisfaction to the management that
the company has been able TO increase its
business at a reduced rate of expense. Its
new business is, therefore, peculiarly valu-
able. The expense ratio for 1888 was only
$50 per cent, a ratio less than that of any
other company.
INTEREST AND RENTS.
The income from inve stments during the
year, while yielding a good margin for sur
plus, indicates the difficulty Of finding quite
as ready and satisfactory employment for
money as in the previous year.
PROFITS ON SALES.
In 1888 we sold for S775, 762 A real estate
which cost US S6S9, $40 %; a net profit of
$50, ,092 15
This brings real estate sales to Jan. l,
1885, up to grand total of 81, ,16S,726 10 of
property which cost us Sc, 800, 45S 81 a net
profit OF SS3S, ,267 50.
OF the % parcels sold during the year 26
sold at profit of SSS, 175 20, and . sold at a
loss oil 81, ,0S3 05-balance, $50 O92 Is,
On bonds sold and paid at maturity DUR
ing the year, there was a net profit of S45,-
075; on sundry items there was loss of
S2,246 "a; giving a total income from profit
and loss items OF SIPS, 92O Al.
LOSS.
For the first time in its history of 43 years
the company has to record loss bv the de-
fault of one OF its financial correspondents, q
class of men through whom most of its loans
are placed according to the general business
custom in such investments, and who are
selected with exceptional care for the char
acter and ability requisite for the most inn
portant and confidential relations which
they hold; men who except in this instance,
have served this company with rare fidelity
and success in all these years; to whose
wisdom and faithful service much of the
success of this company has been due.
The amount chargeable TO profit and loss
from this cause proves to be S4S3, 44S OF;
dedueting the income from profit and loss
above stated, the balance charged to profit
and loss is S954, ,527 60. No credit is taken
for the value OF property restored to us, nor
will there be until it is realized by sale.
During the time this moneywas being ab-
stracted this correspondent handled correct
lyover 81, 900, ,0G0, and possessed not only
our confidence, but that of the business men
of his own city and State in verv marked
degree. His fitness was unqualifedly in
dorsed by the most competent men who knew
him Intimately
To rightly appreciate the effect of this
loss upon the. standing of the company and
the safety Of its contracts il should be con-
sidered in its proportions and not simply in
its aggregate. That is small to one concern
which is large to another. A bank with
81, GOO, 600 of resources, of which 500, 600
was surplus, could meet a loss Of $4,000
without thought of injury to its credit. But
less than what $4,000 is to such a bank,
S4S4, 900 is to a company with S57, 500, 900 of
resources. and with S., ,565, $50 surplus re-
manning after the loss. 1t will not affect the
eompany's dividend.
The conditions which, apart from our en-
tire confidence in the man, made this loss
and its concealment possible, were peculiar
to the times in Indianapolis following the
financial depression OF the last decade, and
the methods by which it was effected were
skiIlfully framedoutof those conditions. No
such condition exists elsewhere, nor has
since that period. 1t is probably needless
to say that whatever lessons as to methods
there are in this matter will be properly ap-
piled.
BONDS.
During the year we have sold, in order to
save the premiums, and have paid off bonds
that had cost US SAL, ,287 80. We have pur-
chased bonds costing 81, 49,, ,040 %, making
our holding at cost on January /, 1859, So
S40, ,575 34 The excellent character of these
bonds will appear from an inspection of the
itemized schedule.
REAL ESTATE LOANS,
We have loaned during the wear upon
real estate security $5,794, 10 46, loans have
been paid off to the amount Of 81, ,OO8, 1856 80,
leaving the amount so invested $31, $780,
448 60. Concerning these we can only say
that they are made with constantly increas-
ing care in only those localities where values
are of the most permanent character.
STANDING OF THE COMPANY.
The company had in force December 81,
1888, 60, go policies, insuring S151, ,361, ,9lS.
It's assets on that day were S57, ,460, ,649 20;
its liabilities by the highest legal standard
of solvency were SOL, ,895 500 81, leaving a
clear surplus of S., $50, ,079 50. Our own
standard Of reserve on business written since
April, 1882, is higher than any legal stand
ard or that of any other COMPANY, and re-
quires us to carry an additional reserve of |
$3.50, $40, leaving the surplus by our own |
standard Of IS, ,214 ,709 So.
Tne premiums and reserves of the CON-
pany are grounded upon the most conserva-
tive bases which have been approved BY ex- |
perience again and again; its contracts are |
of the simplest, most legitimate character, /
devoid of speculative features; its business
is selected with great care; its economy of
management is unrivaled; in actual cost of |
insurance furnished its record is believed to |
be at least unsurpassed; its growth is
wholly healthful, being worth more than it