The Portland daily press., 1893-11-24
NEARLY TWO MILLIONS.
Capital, Surplus and Something
Besides Missing.
GREAT LOSSES OF THE AMERICAN
CASUALTY COMPANY.

The Concerns Capital and Surplus Was
| S1,5O0,0OO-The Company Was Organ
| lied in Maryland and Had to Secure
Special Legislation Before 1t Could Do
Business in New York, Where Its
Charter Was Deemed Too Loose.
| New York, November 23-At meeting
yesterday OF special committee which
had been looking into the affairs of the
American Casualty company this state
ment of the company's affairs was given
by Yalder, Brooks & Walker, public ae-
countants and auditors:
ave regret to say that the company
has not only lost the whole of the capital
81 ZOO, 900, and it's surplus of $500. 600, but
! is further impaired to the extent of near
ly $500, 600. The deficiency is arrived at
by including all assets now exising at the
| actual face value and providing for
losses, $685., ,Oo0"
Today's Herald prints the following
concerning the company's organi zation
and methods of business
| The American Casualty Insurance and
Security company was built upon the
ruins of the American Steam Boiler In
| surance company. The latter was an Or
| ganization incorporated under, the laws
of this state in November, 1883. This
concern did business in almost every
state of the Union, but it was SO
managed that it lost nearly half OF It's
| capital OF half million dollars.
| When the same men who had been the
moving spirits of the American Steam
Boiler company established the Ameri-
| can Casualty Insurance and Security
company in 1890, they reinsured or re-
| placed in this new company most of the
risks of the old company, the latter
| thereafter ceasing to issue new policies.
This is how it happened that when the
| experts recently examined the books of
| the Security company they found most
| of the alleged securities to be merely the
worthless securities of this practically
| bankrupt concern.
| The Casualty company started with a
capital of $1,000,000 and surplus of
| $500, 900. 1t was chartered under the laws
| of Maryland as a Baltimore concern.
| Although a Maryland corporation it has
had and still maintains its principal
Office here at No. "A Pine street, and was
| formed almost entirely through the
| efforts of New York parties.
\ 1t was organized in January, 1880, and
| commenced business June IA of that
year. under a much broader charter than
could be obtained in this state. This
| charter, which was drawn by Mr.. Ro bert
I Sewell of this city, was SO sweeping In
| it's privileges that r. A. Maxwell, then
superintendent of insurance for New
York state, refused to admit the COM
pany on the ground that other state COM
| panies could not be given more privileges
here than home corporations enjoyed.
Legislation was, however, obtained at
| Albany furthering the admittance of
Pierce, who had succeeded Mr.. Max
well as superintendent of insurance,
| authorized the American Casualty to do
business in New York.
1t made deposit of $3.50, 000 with the
| New York Insurance department, which
deposit the superintendent now holds
| for the protection of policy holders gen.
orally. The company transacts nearly
every kind of casualty insurance, in
| Guiding employers liabilities, contribu-
tion, public liability, steam boiler insur-
ance, elevator liability, horse and vehicle
| liability, automatic sprinkler insurance.
| general casualty insurance, individual
accident policies and surety or fidelity
bonds, which last are rapidly replacing
the guarantees Of private bondsmen.
| No other NewYork company attempted
to do anything like the miscellaneous
business that this company essayed. Its
business of insuring railroads quickly
became it's principal feature. There
| were quicker returns in this than in any
other form of insurance, and the men
| who ran the concerns did not consider
| the enormous risks.
The business of the company was
pushed with great freedom as to quality
of hazards accepted, until in the year
1892 it's gross premium receipts were
50, sos, 676. .7s. Its policies insuring rail-
roads against their liability to travellers
and the general public were disastrous
and some of the loss settlements are still
awaiting the result of law suits.
Baltimore, November 20. Edward
Austen, vice president of the Amer
ican Casualty insurance and Secu-
rity company this morning filed bill
in the circuit court requesting that re-
ceivers be appointed for the purpose of
closing the business of the company. The
bill states that the company is insolvent
Its agents in New York are largely in
debted to it, and the company owes $780,
| 600 which 1T has no means of paying.
Counsel for the company filed an answer
admitting the averments of the, plain
tiff S bill and acknowledging the neces-
sity for the appointment of a receiver
The judge Immediately signed the bill
and appointed the Mercantile Trust and
Deposit company of Baltimore and
Edward Austen receivers with orders to
take immediate possession of the COM
pany's property.
Assistant State Superintendent of In
surance Shannon, says the American
Casualty company has on deposit $3.50, 900
at Albany, 5000, 200 in Maryland, and
$4,000 in Virginia
Albany, NY, Novem per 23-Attorney
General Rosendale has concluded that
the deposit of securities to the value OF
$3.50, 900 by the American Casualty In
surance company with the superintendent
of insurance of this state, is statutory
trust to be held for the benefit of the
department and will not pass into the
hands of receiver