364 



Caiiadiaii Forestry Journal. July, i()20. 



out the State, to make them small if 

 for full value or take but a partial 

 risk over a lar^e area, and to have 

 these risks at least one-half mile apart 

 in a wooded area or separated by some 

 natural fire line, as a farm, lake, siz- 

 able river, clearing, etc. Any policy 

 holder who wished to receive more 

 insurance on his timber than repre- 

 sented by $5,000 could be accommo- 

 dated by an arranf^ement made with 

 the Globe-Rut£^ers Fire Insurance 

 Company of New York, an old-line 

 stock insurance company of size and 

 resources, to take the additional risk 

 at approximately the same rate, but 

 on this insurance there was no reti;rn 

 of unused premium at the close of the 

 year. 



Estimates and values were deter- 

 mined on the basis of a written state- 

 ment, filed by the policy holder with 

 'the company. If plantations or un- 

 merchantable young growth of natur- 

 al reproduction, a predetermined valu- 

 ation per acre Avas agreed upon as 

 the basis of loss settlement. If sec- 

 ond cuttings or old growth, the state- 

 ment supposedly represented a fair 

 market stumpage estimate and value 

 of the full amount of merchantal'le 

 and accessible softwoods and hard- 

 woods on the land, large enough to 

 make pulp or lumber, and did not in- 

 clude land values in any way or young 

 growth too small to be merchantable. 

 Final settlement was made on the ac- 

 tual value of the timber destroyed, as 

 found by the company's adjuster, with 

 the co-insurance clause working as 

 described above. In case of a dispute 

 over the salvage value of timber left, 

 the company reserved the right to pay 

 the value of the lot as set in the policy 

 and salvage for its own account. The 

 regular standard policy of insurance 

 authorized in New Hampshire was 

 used, with a rider concerning the spe- 

 cial clauses applicable to timber in- 

 surance. A higher premium charge 

 w^as required for a policy taken out 

 only for the dry season, or for carry- 

 ing over the dry season when canceled 

 at the close of it. During the first 

 season insurance was written to an 

 amount of $276,000, no risk exceeding 

 $5,000 in 57 towns in New Hampshire, 



Massachusetts, and X'ermmit among 

 62 policy holders, 87.4 ])cr cent of 

 which was merchantable timber, 4.2 

 l)er cent plantation, and 8.4 ])er cent 

 young grcjwth. Care was exercised in 

 the accejitance of risks and avoidance 

 was made of land close to railroad 

 rights of way. recent slash, portable 

 mills, ])icnic grounds, large cities, and 

 other nnfaxdrable environments. Cut- 

 ting or the establishment of ])ortal)le 

 mills u])on an insured lot vitiated the 

 ])olicy unless s])ecial permits for same 

 were secured in advance. During the 

 life of the company, which extended 

 for two years, the largest loss sustain- 

 ed was $600, which occurred in a 

 }'Oung plantation com])letelv destroy- 

 ed. 



Due to the war, the solicitation of 

 insurance was given up in 1918 and 

 the company effected reinsurance with 

 the Globe-Rutgers Fire Insurance 

 Company of New York at a rate which 

 left it a small balance for management. 

 At the close of the first year premiums 

 were reduced to l}^ per cent and a 

 further reduction of ^4 P^r cent was 

 in contemplation when the company, 

 having established the principle of 

 timberland insurance and not being 

 particularly interested in the commer- 

 cial aspect of the matter, decided to 

 turn over its policies to the Globe- 

 Rutgers Company, wdio were willing 

 to assume the same rates and agree- 

 ments and offered a larger line to the 

 policy holders, adequately 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. 



A New Profession — Forest Actuary 



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 con- 

 cerning 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 



