It would appear from the foregoing that it was intended that the commissions payable should be computed upon written premiums. The commissions actually paid, however, have not been computed upon the basis of written premiums but earned premiums. For the purpose of clarifying the matter Mr. Perry, acting upon the suggestion of your examiner, has addressed a letter to the company reading as follows: LUMBER MUTUAL CASUALTY INSURANCE Co., "NEW YORK, July 7, 1919. 66 Broadway, New York City. GENTLEMEN: Referring to my manager's contract with your company dated April 25th, 1917, the provision for payment to me of 23% % of the annual premium income of the Company was and is understood to mean that percentage of the earned premiums only, payable as the same are earned, and I hereby agree to this interpretation of the contract to govern all future payments the same as it has in the past. "Yours very truly, (Signed) E. F. PERRY." It is recommended in view of the fact that the contract itself does not correctly express the intent of the contracting parties, that it be amended in due and proper form so that it will so express their intention. Under date of May 9, 1917, Mr. Perry executed a formal assignment of this contract to the Mutual Insurers' Agency Corporation pursuant to which said corporation has since acted as general manager of the company. Dividends The company's dividends are as follows: Upon policy expirations from July 1, 1914, to June 30, 1916, 20%. Reinsurance The company is a member of the Mutual Corporations' Reinsurance Fund, which agrees to protect the company against any loss sustained on account of a single accident in excess of $25,000 up to $100,000. Since the date of this examination, December 31, 1918, the Mutual Corporations' Reinsurance Fund has entered into a reinsurance contract with the American Reinsur ance Company covering losses sustained on account of a single accident in excess of $75,000 up to 100,000. Comparative Exhibit The following table is compiled from the company's annual statements as audited by this department for the years 1914, 1915, 1916 and 1917, and from the figures in this report for 1918: It will be seen from the foregoing that the company has had a steady and continuous growth ever since its organization, and is in sound financial condition. It is worthy of the confidence of the insuring public. METROPOLITAN MUTUAL LIABILITY INSURANCE COMPANY 120 BROADWAY, NEW YORK CITY Examined to ascertain condition April 30, 1919. Report dated June 20, 1919. Examiners: W. A. Billingham, F. H. Trench, H. C. Clark. Organization and History The company was incorporated June 8, 1914, pursuant to the provisions of Article 5-a of the Insurance Law. It began the issuance of insurance policies as of July 1, 1914, and continued to issue such policies until March 31, 1917. Upon the latter date a tripartite contract was entered into by the Metropolitan Mutual, the Industrial Mutual Liability Insurance Association and the Knickerbocker Mutual Liability Insurance Company (the Knickerbocker Mutual has since changed its name to Allied Mutuals Liability Insurance Co.) under the terms of which the business of the two first named companies was merged with the Knickerbocker Company. It was agreed that the Knickerbocker should assume the payment of all policy obligations of the Metropolitan and Industrial companies thereafter incurred, in consideration for which the unearned premiums of the Metropolitan and Industrial were transferred to the Knickerbocker. Both the Metropolitan and Industrial have not transacted the business of insurance since March 31, 1917 (the contract date). Since the corporation ceased to transact the business of insurance it has been collecting premiums upon policies theretofore issued and paying losses incurred prior to March 31, 1917. The company's affairs have been administered during this period, pursuant to the terms of the agreement, by the Knickerbocker Mutual and its successor, the Allied Mutuals Liability Insurance Company. A copy of the agreement referred to is set forth in full in departmental report of examination of the company dated November 28, 1917. Benjamin D. Traitel, of the Traitel Marble Company, Long Island City. Edward B. Brooks, of Bramhall Deane Co., 261 West 36th St., New York. Richard Moller, of Sloan & Moller, 316 East 65th St., New York. Charles P. Sanford, of Lieberman & Sanford, 623 West 57th St., New York. Herman Plant, of L. Plant & Company, 432 East 23d St., New York. William Schlichter, of P. M. & W. Schlichter, First Ave. and 27th St., New York. A. C. Morrison, of Bournonville Welding Co., 241 West 64th St., New York. Louis I. Haber, of H. H. Upham & Co., 508 West Broadway, New York. Avon C. Burnham, Jr., of Black & Boyd Mfg. Co., 17 East 47th St., New York. Herbert W. Heyer, of William H. Jackson Co., 2 West 47th St., New York. E. W. Holland, of Horn-Holland Co., Long Island City. David G. Morrison, Long Island City. George M. Wheeler, of The Maintenance Co., 417 Canal St., New York. Walter S. Thompson, of Klee Thompson Co., 327 East 40th St., New York. Financial Statement The following is a statement of income and disbursements from June 30, 1917, to April 30, 1919, and of assets and liabilities Premiums in course of collection.. Unearned reinsurance due from Contractors' Mutual Liabil ity Insurance Company Total ledger assets $18,598 45 279 07 124 58 $19,002 10 Liabilities No attempt has been made to set forth a statement of liabilities. Not because there are none, but because they are impossible of ascertainment at this time. The company's claim register does not show any outstanding claims, and we were assured by its representatives in charge of the claim department that, to their knowledge, there were no such claims. However, since the examination work was completed we have been advised by the Allied Mutuals Liability Insurance Company that they have received notice from the State Industrial Commission that the compensation case of Bryson v. Davis Brown Company, covered by a policy of the Metropolitan Company, has been re-opened and an award made for compensation from August 21, 1917 to June 12, 1919, and the case continued. The amount of compensation covered by the award to date is $1,410. Of course it is possible that other similar cases may develop hereafter. The actuarial and accounting firm of S. H. & Lee J. Wolfe has rendered certain services in an endeavor to disentangle the intercompany accounts, for which they will doubtless doubtless claim remuneration. Corporation should be Liquidated There are no policies in force, and the annual premium cost on the insurance applied for is nothing, which is less than twentyfive thousand dollars as required by law at the minimum annual rate approved by the Superintendent of Insurance. The corporation has no members. It does not meet the requirements of law which require such a corporation to have a membership of at least forty employers employing not less than twenty-five hundred employees, or thirty employers employing not less than five thousand employees, or twenty employers employing not less than seven thousand five hundred employees, or ten employers employing not less than ten thousand employees. The corporation has ceased to transact the business of insurance for a period of one year and has not transacted such business since March 31, 1917. In our opinion it would be hazardous to its creditors and the public for the corporation further to transact business, and we believe that it should be liquidated under section 63 of the Insurance Law. |