Page:Hints About Investments (1926).pdf/244

 them British taxes are paid, and almost the whole balance, sometimes even more than the balance, is put away to permanent reserve. Dividends are based, not on these surpluses, but upon the interest earned by the reserves. This sound system of insurance finance has been taught to the world by the British companies, and no other system will give that endurance and impeccable security which is of the essence of insurance, and without which insurance is a mockery.

"Last year the fire insurance offices did fairly well, in spite of rather unfavourable results in the United States. The accident and miscellaneous departments, though not productive of large surpluses, did better than in 1923. Marine insurance remained in the trough of the wave, and showed few, if any, signs of becoming seaworthy. Life assurance was prosperous, but as the bulk of the surpluses in this class of insurance, even in proprietary companies, goes in bonuses to policy-holders, it is not a large contributor to profit and loss accounts.

"While making up the figures for the table of general results on the opposite page, we have observed certain recognized principles. The underwriting surpluses in the fire, accident and miscellaneous accounts were arrived at after charging against premiums all the claims paid