STANDING TIMBER INSURANCE 341 



Globe-Rutgers Company, who were willing to assume the same rates 

 and agreements and offered a larger line to the policy holders, ade- 

 quately secured by capital and reserve. At the final wind-up, the 

 guaranteed capital was returned to the directors with 5 per cent yearly 

 interest for the two years. 



The profession of forest actuary had necessarily to be created, and 

 the company's manager, S. L. de Carteret, C.E., and his assistant, 

 Victor Beede, M.F., collected considerable data concerning the relative 

 danger in various sites and from various causes, and the losses in old 

 growth, second cuttings and plantations. Old growth proved the best 

 risk, both on account of its resistance to the spread of fire and the 

 usual care that was taken of it, and on account of the large salvage 

 return possible by prompt logging, if in reasonable proximity to market. 

 Complete loss was rare, the fire commonly did not consume the whole 

 tree, but merely ate into the base, often hardly penetrated the bark 

 higher up the bole. Second cuttings were found to be more dangerous 

 on account of the large amount of slash commonly present and the 

 prevalence of immature trees that constituted a complete loss when 

 burned. Because of its low value this land was less often adequately 

 protected, but the loss when it burned was correspondingly low. 

 Plantations were the greatest risk, being subject to complete destruc- 

 tion by slight fire. Plantation values per acre being largely labor, it 

 was necessary that they be agreed on in advance between the policy 

 owner and the company. In actual practice in the future varying rates 

 should be charged, based on the relative risk of each particular piece 

 insured, according to actuarial tables which are not now in existence. 

 Such tables could be constructed by combining the accumulated ex- 

 perience gathered by all insurance companies doing this line of busi- 

 ness. The profession of timber insurance actuary should be created 

 and at least one such expert maintained as an adjunct to general fire 

 insurance companies, such actuary having previous practical experience 

 as a timber cruiser, estimator, surveyor, operator and trader. 

 The following conclusions are based on experience gathered : 

 (1) A mutual timberland fire insurance company, to be organized 

 safely, should be on a very large scale, with ample funds behind it, and 

 should extend its insurance over wide areas in order to get an average 

 risk. Risks should not be written unless there exists ample protection 

 against fire afforded by State and town or the owner himself, over the 

 area to be insured. 



