"Lloyd's Lists" contain reports of mercantile intelligence of this character, which is classified and posted on different colored slips of paper for the benefit of members and subscribers, and afterwards carefully sifted and recorded.

The "black book" contains a record of some 3,000 casualties per year, and the telegraph room is known as the "chamber of horrors."

When a ship is "posted" at Lloyd's "as missing," the recognized time has come to make claim upon the insurers for the loss.

66

Lloyd's Captains' Register" is a biographical dictionary of all of the certified commanders of the British mercantile marine. "Lloyd's Register of British and Foreign Shipping," published annually, gives full details of every British ship, respecting its ownership, construction, tonnage, and rating. Its symbol "A 1" for the highest class of wooden vessels has passed into popular usage; "100 A 1" means the highest class of iron vessels.

A standard London periodical has recently said: "Towering head and shoulders above the crowd of institutions that have helped to win for England the maritime supremacy of the world, stands the corporation of Lloyds. Its collapse would be more widely felt than that of any other commercial institution in the world."

§ 7. Largest American Marine Company.—Both absolutely and in relation to the other principal classes of insurance, ocean-marine insurance occupies a position of greater importance in England than in America. In the volume of its business the foremost marine company in the United States, second perhaps not even to British Lloyd's, is the Atlantic Mutual of New York.

§ 8. Fire Insurance.-Fire insurance as an organized system has had an origin comparatively recent, and it was not until after the great London fire of 1666 that it took any very practical shape, though back in Anglo-Saxon times there is evidence of attempts among friendly guilds to guarantee protection. against fire and other calamities by mutual contribution. In 1681 the first regular office for insuring against loss by fire

was opened by a combination of persons at the rear of the Royal Exchange, and in 1710 the Sun Fire Office, the earliest mutual and stock company, was organized in London.

The first fire company established in the United States was "The Philadelphia Contributionship for Insuring Houses from Loss by Fire," incorporated on the mutual plan in 1752, one of its early directors having been Benjamin Franklin. In the extent of risks undertaken, the largest fire companies in the world are the Royal, and The Liverpool & London & Globe, both incorporated in England, but having important branches in this country.

Of the American companies, the Home, of New York, and the Etna, of Hartford, stand at the head. It is said that to the enterprising city of Hartford belongs the credit of giving vitality to the agency system throughout the United States, and of exhibiting a larger investment of capital in insurance stock, in proportion to its size, than any other city in the country is able to show.

§ 9. Life Insurance.-The earliest practical embodiment in the direction of life insurance was the foundation in 1706 by royal charter in Great Britain of "The Amicable Society for a Perpetual Assurance Office." The scheme was simply to raise a fixed contribution from each member, and from the proceeds to distribute a certain sum each year among the representatives of those who had died during the year. No one was to be admitted under the age of twelve, nor above the age of fifty-five, but all were to pay the same rate of contribution.

In 1734 the Society made arrangements for guaranteeing that the dividend for each deceased member should not be less than £100, which was the first approach to an assurance of a definite sum at death, whenever that might occur.

The Equitable Assurance Society of London, which was organized under a deed of settlement and commenced business in 1762, may be regarded as the pioneer of the modern system of life insurance. It issued policies for the assurance of fixed sums on single or joint lives, or on survivorships, and for any term. The premiums were regulated according to age. Lives were admitted with due regard to their state of health and other circumstances.

The creation of corporations in America with power to insure lives and grant annuities dates back beyond the Revolution, one of the earliest companies being chartered in the colony of Pennsylvania as early as 1769, for the benefit of the families of Presbyterian clergymen. But the business of life insurance did not assume much importance until within a period of less than fifty years. The first reported life insurance case in the United States1 shows the existence of a contract of life insurance as early as 1809. It was in that case contended by the defendant that no valid contract of life insurance could be made within the State of Massachusetts, inasmuch as the law of England in that regard, it was said, had never been adopted in this country; but the court sustained the contract on the ground that it was not repugnant to the general policy of the law or to good morals, and that no reason had been given for condemning such contracts, except by the French Courts which considered "that it is indecorous to set a price upon the life of a freeman which is above all price "-a reason which was pronounced insufficient, especially as coming from France, "where," Chief Justice Parker remarked, "freedom had never been known."

Accident insurance, which is a branch of life insurance, is a development of later growth. Ordinary life insurance protects against the pecuniary loss arising to a man's family, or creditors, or others, by his death, whether that is caused by old age, accident, or disease. But accident insurance protects only against losses caused by accident, whether resulting in death

or not.

An important company was established in London in 1849 for insuring against the consequence of railway accidents-The Railway Passengers Assurance Company. In 1856 its business was extended to embrace accidents of all kinds. The companies carrying the most extensive accident risks in the United States, and probably in the world, are the Travellers, of Hartford, and the Mutual Accident Association of New York City.

In the United States, life insurance has attained a greater relative importance among financial institutions than in any other country. During the years which immediately followed the close of the civil war, it grew with unparalleled rapidity; new companies were established in great numbers; new features of

1 Lord v. Dall, 12 Mass. 115.

insurance contracts were devised, and soliciting agents canvassed the country from one end to the other. In the magnitude of its transactions, no life insurance company in the world is able to make comparison either with the Mutual or the Equitable, or the New York Life Insurance Company, all three of New York City. Each one of these colossal institutions exhibits an annual statement of assets greatly in excess of $100,000,000. It is to be observed that fire policies on the average are for a much shorter term than life policies, and that a life company is ordinarily obliged to accumulate for the payment of future losses a much larger amount of assets than is required in the conduct of the business of marine or fire insurance.

§ 10. Real Estate Title Insurance.-Passing notice must be given to a class of corporations which have of late years been organized in many large cities in the United States to insure real estate titles, and which generally unite with title insurance an extensive and rapidly increasing business of searching titles. Their policies obligate the insurers, in substance, to do three things for the protection of the insured: (1) to defend suits against the title at the expense of the insurers; (2) to pay judgments rendered; (3) and if the insured contracts to sell or loan, and the title is refused, to test its validity in court at the expense of the insurers, and if defeated to pay damages and also to take the property where the insured has contracted to sell it.

Of this class of corporations the Real Estate Title Insurance and Trust Company of Philadelphia, organized in 1876, was the pioneer. The Title Guarantee & Trust Company of New York City, incorporated in 1882, does an immense business in guaranteeing titles; and the Lawyers' Title Insurance Company of New York City is also an important company, though it gives precedence to its department for searching titles. The facilities of such permanent organizations for utilizing, arranging, and recording the past results of their extensive and multiplied examinations of titles are so great that it is becoming more and more difficult for individual attorneys to compete with their prices in this branch of legal work.

11. Classification of Risks.-In fire and marine insurance, risks are classified according to the degree of hazard,

and the premiums graded accordingly. But in life insurance, as a rule, only healthy persons are accepted, and consequently the premiums are scaled according to age; sometimes, however, special risks are taken involving a hazardous occupation, or an unhealthy location of residence, for which an extra premium is paid. In all branches of insurance the amount of the premium is made to depend more or less upon average results which have been arrived at after elaborate observations and careful collection of statistics bearing upon the subject.

In accepting or rejecting a proposed risk, the insurers are governed by their familiarity with these general laws of average. But it is also very important for them to gain a thorough acquaintance with the facts and circumstances relating to the particular case, to ascertain whether it falls within or outside the general law. The location; the inherent nature and condition of the subject-matter; the character of the insured for honesty or dishonesty, negligence or prudence; the peculiar temptations to him in consequence of business embarrassment or over-insurance to cause the event insured against or be careless in preventing it-all these considerations are influential in inducing the insurers to accept or decline the proposal, or to accept it only at a special rate of premium. In life insurance the company desires to know the age of the applicant, his occupa.. tion, residence, probable area of travel, his health present and past, and also the healthfulness and longevity of his parents. and nearest relatives. An examination made by the company's medical examiner discloses with some degree of accuracy the condition of present health, but the other information is derived largely from the applicant himself, who is required to answer a series of printed questions detailed in a paper called an application, which he is required to sign. In fire insurance the company generally desires to know—according to the subject-matter of the proposed insurance, whether dwelling-house, barn, store, factory, theater, church, railway cars, etc., or their contentsthe location; the materials and structure, whether wood, stone, brick, or iron; whether the roof is slate, tin, tar, or shingles; the condition of flues and chimneys; whether the building is fire-proof or not; its relations and communications with adjoining premises; whether it has iron shutters and iron doors; the inflammability of personal property; the character of the use