| THE STATE IN THE MARYLAND ECONOMY, 1776-1807 235
fire). At the end of the seven-year policy period, the deposit
together with a " proportional dividend of the profits," after
deducting any losses, service charges, and office expenses, was
to be returned to the policy holder?zo
One interesting article in the charter empowered the direc-
tors of the company to-invest their funds in stock of the Bank
of the United States or to lend out their money on sixty-day
promissory notes. Under these provisions the insurance so-
- ciety might have opened a bank, as did some companies in
other cities. The latter companies were chartered to do one
kind of business but construed their charters liberally, e.g., the
Manhattan Company of New York, a water-supply company,
which soon found the banking business less troublesome and
more profitable. Like the Manhattan Company, the Baltimore
Equitable Society possessed a perpetual charter. But the Equit-
able Society has made fire insurance its sole concern for the
one hundred sixty-seven years of its existence.
The only other mutual fire insurance company, " The
Georgeto-,>>n Mutual Insurance Company against Fire on
Houses, Goods and Furniture," chartered by the General As-
sembly before 1807, soon passed out of the jurisdiction of
Maryland, but it is considered here because it was created by
the state of Maryland. Some of its provisions differ from those
of the Baltimore Equitable Society, and these differences illus-
trate that, at least in the field of mutual fire- insurance incor-
porations, the Maryland legislature did not follow set patterns
or models but often shaped the company in accordance with
its own by-laws or articles of association, such as the Baltimore
Equitable Company's Deed of Settlement.
Property worth .$ 100,000 teas to be subscribed before the
Georgetown Company could organize, but there was no stock,
since operations were on a mutual basis. Losses were to be
==° 1 bid., and " Address to Members. centennial. Baltimore Equitable
Society,
1794-1894." Maryland Collection, Enoch 1'ratt Free Library. If ever a fire
loss
amounted to more than the "whole stock," only a just portion of the-whole
stock was to be assessed. The company worked under the seven year mutual
plan for seventy years; in 1865 they began their present practice of
issuing per-
petual policies with no dividend in order to provide greater security for
the
company by creating a fund to repay large losses. This farsighted policy
amply
rewarded the company in 1904 when the -Baltimore Equitable society was one
of the few insurance companies able to survive the Baltimore fire and pay
its
losses.
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