UNITED STATES DEPARTMENT OF AGRICULTURE 



BULLETIN No. 786 



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Contribution from the Bureau of Markets 

 CHARLES J. BRAND, Chief 



Washington, D. C. 



May 28, 1919 



PREVAILING PLANS AND PRACTICES AMONG FARMERS' 

 MUTUAL FIRE INSURANCE COMPANIES. 



By V. N. Valgren, 

 Investigator in Agricultural Insurance. 



CONTENTS. 



Page. 



Introduction 1 



Location of companies, date and 



method of incorporation 2 



Membership, votes, and annual meet- 

 ing 4 



Directors and officers 5 



Hazards and risks 6 



Business territory 7 



Plan of raising funds and frequency 



of assessment 8 



Page. 



Liability of the insured 9 



Classification of property 9 



Method and cost of getting business- 10 



Salaries of directors and officers 12 



Adjustment of losses 12 



Surplus and refunds 13 



Reinsurance 14 



Conclusion 14 



INTRODUCTION. 



There are about 1,950 farmers' mutual fire insurance companies in 

 the United States. These companies have in general shown a high 

 degree of stability and have proved of much value to their members. 

 The total amount of insurance which they now have in force exceeds 

 $6,000,000,000. A questionnaire was sent out by the Bureau of Mar- 

 kets making inquiry concerning the plans of organization and the 

 business practices of these companies. The information contained in 

 this bulletin is largely a summary of the replies to this question- 

 naire. 



The organizations here classed as farmers' mutual fire insurance 

 companies are those mutuals whose risks consist either entirely or 

 very largely of farm property. In most States where these com- 

 panies exist they are recognized as a separate and distinct class of 

 insurance organization and operate under laws which practically 



Note. — This bulletin should) be of special interest to the directors and officers of 

 farmers' mutual insurance companies, and to those who contemplate the organization of 

 such companies. 



104975°— 19— Bull. 786 



