674   BEST'S INSURANCE REPORTS— FIRE AND MARINE.

BANKERS AUTO INSURANCE ASSOCIATION—Continued.
for its compensation a life membership fee of (1) for fire, any calendar month by giving
windstorm, tornado or cyclone insurance, $5; (2) for theft writing.

insurance, $5; (3) for collision insurance, $5; (4) for in
demnity- protection, $5: or for all four forms of insurance,
if taken at the same time, $17.50. This being a life mem
bership, the insured may have his insurance transferred
from one car to another, by the paying of a transfer fee of
$1, which fee goes to the attorney-in-fact, together with
3.0% of the deposits made by each subscriber, from which
is paid all expenses, except legal and adjustment expense,
licenses, taxes, fees, and the expense of levying and col
lecting premiums.

• The premiums for six months are collected in advance and
assessments are made semi-annually. Failure to pay these
assessments within fifteen days from the elate of such call
forfeits the rights of the subseriber. The assessment lia
bility is unlimited.

As the exchange did not begin to collect premiums in
advance until after January 1. 1920. no reserve for un
earned premiums has been set up in this statement.

The attorney-in-fact has a contract with the Commercial
Health and Accident Underwriting Company, of Spring-
field. which states that the underwriting company will, if
necessary, finance the payment of lossess until the semi-
annual period when assessments are made. For this ser
vice and all other privileges afforded the exchange by the
underwriting company the attorney-in-fact pays seventy-five
cents per application.

Apparently no provision is made for the creation or ac-
cumulation of a reserve or emergency fund. The sub-
scribers may retire from the exchange on the last day of

BANKERS FIRE INSURANCE EXCHANGE.
29 South La Salle Street, Chicago, Ill.

five days prior notice in

Details of the operation of the exchange will be reported
to the subscribers annually. Service of process may be
made upon the Insurance Commissioner or upon the
attorney--in-fact. Losses are adjusted by salaried repre
sentatives of the exchange.

The securities are in the custody of an advisory board,
consisting of five subscribers, to be elected the first Mon-
day in March of each year.

Advisory Board.— J. IV. Cherry, president; H. B. Hill,
president of the Mutual Life of Illinois; G. C. Rockwood,
vice-president of the Mutual Life of Illinois; H. G. Rock-
wood, vice-president of the Commercial Health & Accident
Company. and F. M. Feder, director of the Commercial
Health and Accident Company.

Its statement as of December 31. 1919. is as follows:
Admitted cash assets: Cash in banks and office, $8,713.68;
premiums or deposits outstanding not over three months
due, $6,018.45; total cash assets, $14,732.13.

Liabilities: Losses in process of adjustment. $1,596.49;
due attorney-in-fact for administration expense, $4,021.39;
total liabilities. $5,617.88: net cash surplus, $9,11425;
total, $14,732.13.

Cash laconic. 1919.-Premium deposits written, gross.
$48.206.65: total cash income, $45.206.65.

Caste Disbursements, 1919.—Net losses paid, $9.784.28;
paid to attorney-in-fast for administration expense, $2.-
948.40: commissions. $24,288.97 ; other expenses, $2,489.74;
total cash disbursements, $39,511.30.

In connection with this report, see important article in
troducing this section.

History.— This is an inter-insurance institution, which
was licensed on October 3. 1917, and which was organized
by George M. Cobb, of Indianapolis. who is the attorney
and manager with offices at 105 \Vest Monroe street, Chi
cago, and in the Merchants' Bank Bui_Cdieg. at Indianapolis,
Indiana.

Management and Reputation. George M. Cobb, the at
torney and manager, has been an active insurance agent iu
Indianapolis for over twenty years. He was, general agent
for Indianapolis for the Ohio Fanners Insurance Company
of LeRoy, Ohio, and for twelve year,. was Indiana State
agent for the Globe & Rutgers Fire Insurance Company
of New York. He disposed of his general agency to the
State Savings and Trust Company of Indianapolis and
for a year and a half after the transfer was the manager
of the insurance department of the Trust Company. until
he organized this exchange.

Plan of Operation.— This exchange limits its acceptance
to protected manufacturing plants of brick construction and
single occupancy mercantile risks against. loss or damage
by fire and cyclones.

The attorney and manager receives no commission or patt
tnent for administration expenses, unless the exchange
actually makes a profit. The compensation is on a con
tingent basis only: the manager receiving one-third of the

actual saving, if any, between the prevailing cost of insur
ance in stock companies and actual cost of the insurance in
the exchange. This compensation is paid at the end of the
policy period and not until then. The manager defrays all
adminisiration expenses. including compensation for his
own services and all expenditures of whatsoever nature,
except for losses. adjustments. taxes and legal expenses
incurred upon authority of the Advisory Board,.

The risks insured against fire and cyclones are limited
to the better classes of protected manufacturing plants and
mercantile establishments with single occupancy, and high
commercial ratings. No business is accepted from brokers.

The maximum line accepted is $12,500 gross., which is
reinsured down to $2,.500, subject to one fire.

New members are admitted upon the recommendation of
the attorney and manager.

The proportion of liability assumed by each subscriber is
determined by the amount of the premium deposit, and is
limited to the payment of one additional premium. Each
member underwrites a proportion of each policy issued dur
ing the period of his membership Each premium deposit
received is credited to the account of the subscriber when
paid. Tariff rates are obtained and on this the deposit
premiums are based. The members or subscribers are not
charged with any- administration expense. The subscribers