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ns Continued Growth Revealed at Annual Meeting. â€" $5,034,911 b! Paid in Dividends in 1932.â€"Liberal Dividend Policy for 4 Current Year. â€" Insurance in Force and Assets Increased. §~* â€" Company‘s Operations During 63 Years Result in Outâ€" standing Returns to Policyholders. 1 ‘‘The financial position of many of our municipalities has become more acute in recent months, owing to curtailed tax collections, but there is ho})e that this will hasten a measure of economy in Municirll and Government management which has already been too long deferred. ‘‘The Imperial Conference gave promise of material improvement in our fundamental industries, princiâ€" pally the various branches or agriâ€" culture, and produced a feeling of renewed confl':ience throughout the country, and especially in Western Canada. Nature provided a bumper crop in most of the Provinces, but unfportunately the prices of wheat and other cereals, instead â€" of realizing the improvement which had been hoped For, declined to n point unrecorded in history, as a result of which the tendency toward improved confidence was not mainâ€" tained. The substantial favorable balance of trade for the year is, however, an encouraging sign. President of the Mutual Life Assurance Company of Canada. ‘"Nineteen hundred and thirtyâ€" one was a year of worldâ€"wide deâ€" pression, and 1932 has shown little, if any, tangible improvement. We have had, and now have, much unâ€" employment, low commodity prices and general disturbance of trade and living conditions. Generally speaking, the year proved to be a most unfÂ¥i@#%1 one and presented many interesting developments. Inâ€" ternational financial settlements, or rather unsettlements, considered by many economists as the foundation of the world‘s economic woes, markâ€" ed a most erratic course. Earlier in the year the Lausanne Conference and the moratorium of President Hoover afforded some hope that a solution of the problem was in sight, but the events of the late fall and early winter have not tended to reduce the uncertainties and difficulâ€" ties in which international trade and finance are involved, and have left the world still groping for a way out. "The General Manager will deal in detail with the outstanding feaâ€" tures of our statement and with our investments, and it is therefore not ne'cessary for me to enlarge on them. The vacancy on the Board has been filled by the election of Mr. Walter H. Somerville, our TGeneral Manâ€" ager, who has been in the Comâ€" pany‘s service for thirtyâ€"three years, and whose appointment, I am sure, will meet with the hearty approval of the policyholders. The vacancy on the Executive Committee of the Board has been filled by the apâ€". pointment of Mr. E. G. Long, K.C. "It affords me a very great deal of pleasure to welcome you to this, the Sixtyâ€"third Annual Meeting of the policyhoiders of The Mutual Life Assurance Company of Canada. "Before commenting on the Direcâ€" tors‘ Report, which you have just heard read, I wish, on behalf of my fellowâ€"directors, to express our deep artd sincere grief at the death of our late highly esteemed Chairman of the Board, Mr. Charles M. Bowâ€" man, who died on October 24th, 1932. His death is a great loss to the Company, and is deplored by every director, officer and employee. He joined the Board in 1916, and became Chairman of the Board in 1926, which office he filled until his death. Able, loyal, never lacking in courage or vision, industrious, of sound judgment and untiring in his service to the Company, he was one of its builders. Of him it can be truly said: ‘Continued growth and satisfactory progress were revealed in the reports presented to the policyholders of the Mutual Life of Canada at the Annual Meeting held here on February: 2nd. Mr. R. O. McCulloch, President of the Company, presided, and in an encouraging address said, in part: \ ‘E‘en as he trod that day to God, so walked he from his birth, In simplen ‘ss and gentleness and honor ard clean mirth.‘ R. 0. MeCULLOCH Of The Mutual Life of Canada of his one be "While the financial statement in dicates clur:Lfint it has again been deemed advisable, in the values placed on our securities, to make substantial rrovidon agninet possâ€" ible losses, it must be a source of satisfaction to ever[osolieyholdar to know that it has n possible to make these provisions out of the surplus earnings of the Company for the year without affecting our abilâ€" ity to make su distribution to the policyholders in 19388 closely apâ€" grolehlng that of the previous year. his has been possible only by reaâ€" son of the cl adherence to the sound pflndpm of risk nloeuon,‘ lhv:om:nt and mugcnt. which characterized throughout its long ml "Turning to Western Canada, I may say that the attitude of your Comrnny towards the West and its perplexing problems continues to be both sympathetic and constructive. In addition to the substantial in vestment which we have made in Western Canada in the form of farm and city loans, and the obligations of Provincial and Municipal authoriâ€" ties (in the safeguarding of which we are naturally most vitally inâ€" terested), our interest in the welâ€" fare of the Prairie Provinces is based on the strong conviction that the prosperity of our Dominion as a whole is fundamentally dependent upon profitable agriculture, so large a part of which is the Western Plains. In addition to the latitude and relief which we are according needy mortgagors in meeting their obligations, we _ are continuing through the Colonization Finance Corporation, . to ive _ practical assistance to hundretfs of farmers in the conduct of their operations and the improvement of the fertility of their lands so that they may be in a position to take advantage of price recoveries. Our coâ€"operation with this worthy enterprise has been severely hlndiclpfi:d through the death of the Chairman of our Board, Mr. C. M. Bowman, who, as President, directed the mativities of the Colonization Finance Corporaâ€" \tion since its inception. Althoufih ‘that corporation is still young in ‘yenrs the‘ work has expanded mpidiy until, from a nucleus of one zone manager, in 1929, the orâ€" ganization now includes a chief farm mahager and fourteen zone managers, with such executive and clerical assistance as is required for such an undertaking, and it is operating in a large area of that part of Manitoba which is under cultivation and in the Eastern secâ€" tions of the Province of Saskatcheâ€" wan. Agricultural and governmental authorities in the Provinces where operations have been carried on for a length of time sufficient to judge of the results are loud in their praise of the ‘ood work which is being accomplished.‘ The loss of Mr. Bowman to this work will be keenly felt, but our CompanÂ¥ will continue to contribute to its successful operation. â€" ‘ on new purchases of Government bonds. Our holdings of Canadian and Provincial Government and Government guaranteed securitics were 34 per cent. of our total bond hoidings as at December Slat, 1932. per cent. which was slightly higher than the average yield on new purâ€" chases for the past three years. You will be glad to know that we obtainâ€" ed an average rate of 5.30 per cent. of our new. pil‘rcme-; L;'h:;: been expectéd," but the actual average rate on all new purchases was 5.51 [ "Owing to general contraction in the construction industry, â€" your Directors invested most of the Company‘s available funds in the purchase of the highest grade seâ€" curites. Of the total new bond purâ€" chases made in 1932, $5,560,946, or 64 per cent., was invested in Doâ€" minion or Provincial Government or Government guaranteed securities, and $2,935,878, or 34 per cent., was invested in city, town or other municipal obligations, and the balâ€" ance of 2 per cent. was invested in parochial or public utility securities. In view of the extremely large proâ€" portion of highâ€"grade bonds purâ€" chased during the year, a decrease in the rate of interest on the total POWER P 0 Arodimci cce fiie i 0i 22. & Efaced upon life insurance policyâ€" | holders in the form of the premium | tax imtrooed by the Provincial authorities. These taxes are actually | paid by the individual policyholders, although levied ;Elm the company |or companies. y are necessarily included in the cost of insurance, |and are directly reflecigd in inâ€" creased premiums or reduced ch'vi-‘ dends on your policies. The proporâ€" tion of the premiums paid by our policyholders to protect their deâ€" pendents, which was exacted by the Provincial Governments during the past year in the form of a premium tax, amounted to $304,665.69, as compared with $224,841.76 in 1931, or an increase of over 35 per cent. When the difficulty of balancing Government budgets in these times is considered, I fear there is little hore that life insurance policyâ€" holders will be relieved of this unâ€" fair imposition until all our governâ€" mentsâ€"Dontinion, Provincial and Municipal â€" effectively attack , the root of the problemâ€"viz., excessive expenditure beyond what we can afford. Nevertheless, I believe that it is essential that strong opposition should be made to this particular form of indirect taxation, as it strikes at the thrifty, honest cit‘zen who is endeavoring to provide for the support of his dependents in 1 order that the State may provide| funds for those who are eitfler too | careless or too incompetent to take| care of their own. In my judgment | this tax is indefensible, and I beâ€"| lieve that one of the first acts of| our Provincial Legislatures should|; be to delete this form of taxation| from the statutes. P I deem it my duty to again rotest there is no Government today which has any real hope that its pe.:’ple can emerge from the depression without contributing to the improveâ€" ment of conditions throufhout the world, and the universa recogniâ€" tif:. of this is a substantial step in 1 will not attempt to o&er any prophecg as to the immediate fuâ€" ture. ur organization is well equipped to take ndvanhge of any improvement in business t roughout Canada, but we necessarily depend upon t‘le prosperity of the comâ€" munity which we are serving, and in spite of many advantages tfint Canâ€" ada enjoys in comparison with other countries we are not independent of international conditions. All Govâ€" ernments have been slow to realize, "I trust that I have made it clear to you that we have a wellâ€" founded confidence in the future prosperit{ of our Company and our country, but you will not expect and ‘‘Practically the entire business issued by this Company since its organization sixtyâ€"three years ago has been on the participating lan, and the results under our poficiea show conclusively that the particiâ€" pating plan has been muchâ€"superior to the nonâ€"participating plan for our policyholders. I wish to definitely state, therefore, that insofar as our Company is concerned we favor‘ ranlciplting plans, because we beâ€" ieve that our policyholders will obtain the best results from them. "At the present time, when low commodity prices and depressed world trade are adversely affecting general business and many of our basic industries, the advantage of participating as contrasted with nonâ€" participating life insurance is being questioned; but I believe the stateâ€" ment which our company presents today affords the answer to this questionâ€"viz., even in a great and protracted depression sufficient diviâ€" dends can be paid to render insurâ€" ance cheaper under participating than under nonâ€"participating poliâ€" cies. It is apparent that the large amount of our‘earnings in the past year not only enables our Company to make provision for the depreciaâ€" tion which has taken place in inâ€" vestments, but is sufficient to proâ€" vide generous dividends to policyâ€" holders, even in these strenuous times; and when the improvement inâ€"conditions com#s, as we are all sure it will, our policyholders will benefit actordingly. "In the sixty two years which have elapsed since this statement was made, I believe that the hopes of the founders have been fulfilled. The operations of our Company have been marked by economy, efficiency and progressiveness, and notwithstanding the vicissitudes, of former depressions, of war and of pestilence, which have on occasions temporarily checked the rate of growth, our Company has maintainâ€" ed unimpaired its financial strength, and its record of generous premium refunds or dividends to policyâ€" holders, which has justified the main principle upon which the Company was establishedâ€"that of furnishing life insurance at the lowest rates compatible with safety to the assured. "In the Directors‘ Report at the First Annual Meeting of our Comâ€" tnny (then The Ontario Mutual l ife Assurance Company) on the 15th of February, 1871, a statement was made which has often appeared in the literature of our Company, and which I believe may with bene. fit be repeated at this time. In outâ€" lining the objects of the promoters of the Company, it was stated that the founders were led to entertain the project of establishing a life inâ€" surance company based upon purely mutual principles, Believing it highly desirable that the benefits of Iife‘ insurance should be extended as widely as possible and at the cheapest rates compatible with safety to the assured. by k uie Emm RIDCETYE is found in the persistence of its policies, is a true and lasting charâ€" acteristic of its inherent soundness and the assurance of future success. Such losses as may be sustained from time ot time throu? actual depreciation of a reasonable asset structure, based on careful investâ€" ment, can easily be met as theg occur from the normal profits whic accrue from a wellâ€"underwritten business in force without in any way im%airing the ability to meet policy obligations and pay substanâ€" tial dividends. be more imaginary than actual. However, the confidence in which a compan‘y is held by its policyâ€" holders, of which practical evidence SNeiBne B ioh artdiin lt mucd Kul of the possible losses foj whic i{)rovipion is being made to day will in all likelihood prove t« P’e more imaginary than actual Nq EoD VN O KOV POReFe Bu:;‘ to pqydhh mm No} are presently q s o the assets in his portfolio 151? true criterion of the conpanrl real worth, as prices today are doubtless in many cases much below intrinsic worth values, and many securities now ciuotcd at a discount will be held tll’uuktutity and paid at par. .lflb.â€"&-‘.fi.u E:..‘!!!'!‘.".". soundness of its list of physical assets may ", ohe of the most valuahle nc ofp t is the carnâ€" for as would enable the câ€"m"i Burâ€" r:‘:‘mfl“b“.lhél. Agurea, .:: holders in 1983. Owing clouded outlook and the im ::. bm:inufinm ctln ang 0 om s dnme{‘ dnlr;‘b.k ut: l&n '- as would ena! Compa plus Funds to be maint amounts to $4,276,809.44. Last October it became n for the Board of Directors of the Zonm to determine the basis upon vhle‘ Dividends should be paid to policyâ€" pre "Considering the Cash Account, although total payments to policyâ€" holders during 1982 for Death and Disability Claims, Matured Endowâ€" ments, Purchased Policies, Surg]nl. Annuities, etc, were $17,146,54 A y these large cash disbursements, in addition to heavy disbursements for policy loans, were made without any delay and with no necessity for the‘ sale of securities, or for borrowing, in order to do so. In fact, the Camâ€" an{- position, with respoct to ri_qu dity, was such that laroa nn«. MHBao® snb P ditat fio ie Rnainabadis d 21173 values of a large portion of our bond investments exceeds our book value and in the a Rate the value permitted by the Eeplnment of Inâ€" surance is greater than the value at which all our bonds and stocks are included in the Balance Sheet by $1,071,612.02, in Rountntty? CC TT present adequate to rrovide for any of our mortglze caims in €xâ€" cess of 70 per cent of a recent valuation of the properties upon which the security rests. "The book value of bonds has been written down $1,000,457.87 as provision for possible losses. In adâ€" dition to this, the general Investâ€" ment Reserve has been increased from its amount at December 31, 1931, $826,490.94, by a transfer from Free Surplus sufficient to increase the general Investment Reâ€" serve to $1,200,000, which would be sufficient to write down the Comâ€" pany‘s Bond Investments to the values authorized by the Departâ€" ment of Insurance in all cases where the authorized value is less than the book value. It must be bo:-ne in mind that the authorized _"" heeping with the practice of recent years, the Company has conâ€" tinued to increase its interest and rrincipsl reserves against possible oss on farm mortgage investments. Reserves â€"of this Charaotar ars af 1 o oo e en ie o m Sn to meet their obligations, which has resulted in the necessity of granting extensions. The Company is conâ€" tinuing to coâ€"operate with these borrowers, and we trust that with a reasonable increase in the prices they receive for their produce, toâ€" gether with improved methods of farm operations which are being enâ€" couraged, they will be enabled to discharge their obligations, which under such circumstances these gorowers are willing and anxious to 0. 11 "Our Mortgages and Sale Agreeâ€" ments are $1,599,683.52 less than they were a year ago, and constitute 82.02 per cent. of our total assets. Of the $42,329,022.79 of these loans, 78.33 per cent. are on imâ€" proved city. properties and 21.67 per cent. on farm properties, the latter being for the most part in Western Canada. Applications for new mortâ€" gage loans in 1932 were greatly curtailed as compared with 1931, awith the result that the amount inâ€" ’vested in new mortgage loans was ‘small, and this fact, coupled with the repayment of existing loans, particularly from the cities, has reâ€" sulted in the amount of our outâ€" standing mortgage loan investment being at a lower figure than a year ago. Interest on our city loans has been met in a satisfactory manner, the amount of overdue interest thereon being .61 per cent. of the principal sum invested. Similar reâ€" marks to those of a year ago may ! "It is interesting to note that while the net increase in total assets in 1932 was $6,350,263.98, the increase in the Company‘s holdâ€" ings in Government and Municipal Bonds, which are entirely Canadian, were $4,772,904.22, and in Loans to Policyholders, $3,803,054.81, the total increase in Government and Municipal Bomfi and in Loans to Policyholders being $8,075,922.39, which indicates that the Company‘s new investments in 1932 were of the soundest possible character, and further strengthened the Company‘s financial position. When commenting on the Annual *__ Surplus Funds.as at Ml n"'l 1931, .°°"-‘" Statement and the Conipany‘s inâ€" Pruc.-l's us for Conti les . vestments, Mr. W. H. Some General Manager, said in part : oc te . "In keeping‘wig‘h the practice General r of the Mutual w.':mn:‘.‘a..,ef'cma.. Many Figures of Interest in General Manager‘s Pn â€"deealbiindanhithicbrnt this character are at TT OOni Aieitvtin ariiharn d sA Ad css i oo d dividends able in 1988 an amount ol'flum. and efiz\nd almost unelu;r‘ the -m. funds of _ $5,357,528.97, | col ng â€" of neral _ Investment Reserve of flm,ooo and â€" Free h?I- for Contingencies of $4/157,523.07; ‘"Turning to> the : Assurance Acâ€" count;, ou‘r‘ Ageney Staft> wrote 88 per cent. of their previous year‘s Mneedu 15 per cent., :r;(;l::t';l'!: some me permit on for possible investment K:'.’. of :‘g- xradnuhly $1,500,00 . This modiâ€" cation in the scale of surplus disâ€" tribution reduced the proviséen for at the same time permit a substanâ€" tial sum to be taken from the year‘s earnings as provision for possible investment losses. An estimate was made of the probable Sutplus Earnâ€" ings for the year, and the approxiâ€" mation proved to be remarkably close to the actual earnings of $5,509,688.31. It was found possible to allot dévidends to policyholders in 1988 on the basis of 90 per cent. of the dividends paid in 1982, exâ€" cept that Firstâ€"year Dividends were e R. 0. McCurtocn, Presiden: 1094 $2,235,384 $16,122,195 $65,001 $216,337 _ ; 1912 $20,071,345 $77,921,144 $277,631 $1,275,886 1932 $132,198,393 $51 7.267,974 $5,034,912 *‘ $17,146,547 The 63rd Annual Meeting of the Policyholders will be held on Thursday, February 2nd, 1933, at the Head Office, Waterloo, Ontario. fying surplus earnings during the past year which permit the continuation of the unique record which the Company has mainâ€" tained throughout its entire history of over sixty years in the field of low cost life insurance. .& e The pnncnl)le of mutuality has again been justi;ied b} the gratiâ€" $b n i n 4 2 L9 s & DNcade & s & New Amsurances paidâ€"for â€" â€" â€" â€" â€" â€" $ 44,038,582 Assuzcances:â€"in force December 3let, 1932â€" $517,967,974 _ Lowest Expense Ratio in the Company‘s History. & Death losses were well within the expected. _ Surplus carnings per $1,000 of total assets were $41.68, Sueplus funds and Contingency Reserves â€" id P li?hold +0 > & %â€" Div&dt.:hpfi o 4 ersâ€" f Assurance Company ; OF CANADA Net Amount Transfered to Surplus Funds â€" dw-“fl'flfllfl“‘ s Ts s Amounts 'gu-:(l._ ig; ‘Vfic ::l * _ rfoâ€"â€"oâ€"sâ€",â€" 22,160,781.59 Surplus Earnings for Year â€" â€" . . . . . . § 5,509,688.31 1 “;y.c_‘; ,._._-,_'---,. : .- ;:vou.yl’:z; mt and Appreciation on Ledger Assets 53.463.82' EXPENDITURES AND RESERYVESs Death and Disability Claims, Matured Supplementary Contracts, P $12,115,791.93 ote. â€" . e % a Increase in Actuarial Reserve and Amounts hhoan?adt.-----fi.mm.% @ on Amount Written O# Head Office Premises 50,000.00 ~\_ _A Purely Mutual Company Premiums (net) â€" â€" â€" . . . + $18,354,729.90 Interest and Rents (after further deducâ€" tion of $218,046.44 for possible loss of _ interest on Farm Mortgages) â€" â€" _ 6,878,919.69 Bonds as Provisian for Possible Losses 1,000,457.87 MUTUAL LFE || _ Outstanding features of 1932 Statement: for the Year Ending December 31st, 1982 ROCIC Z000°00F JifM, Z701, CORMSHIE§ Of: CGeneral Investment Reserve « â€"â€" â€" . $ 826,490.94 Free Surplus for Contingencies â€" â€" â€" _ 4,538,343.82 â€" T ho ea n en en e m on m for, and 46.04 per cent. of the 1 business proszccd by our Agencias was issued on the lrve- of mm already holding policies. percentages are both larger than a year ago. We have fortyâ€"two ies throughout Cmnada, in fim.‘w-:‘n oMcdc in St. JohT‘n. ou: and regpresentation in Bermuda. Rach of these nciea and through our Comny.{r.nlned Agency Manager, part of whose duâ€" fluhhw:“nrrvhe the staff of field representatives in his particular man of today is more than a seller of policies, we are a“r:.yh. on in our agencies and thro our Comâ€" r:.yg publications â€" and _ lendi library eduomtional activities w)l'e“ f PROFIT AND LOSS ACCOUNT REVENUE BASIS m for, and 46.04 p 1 business prod Agencias was issued mm already â€" ho! percentages a1 than a year ago. We ::o.eiu throughout ".fion to an office Newfoundland. and _Ihat our present policrholders xener::l‘{ appreciate the â€" service rende: them by the Con?nny and by our Agency Stai is indicated by the amount of new business received from them. 36.25 bper cent. of the number of policies that policies now being written are not lapsing so readily as formerly. The lapses and expires in 1932, less the revivals, were . $2,687,223 lesa than in 1981. ‘The total terminaâ€" tions of 1982 were, of course, much heavier than in 1931, the increased terminations comirfiI as the result of surrender, or through policies l-ring by reason of loans overâ€" taking the cash values. \ RECORD OF PROGRESS gVee Business Dividenda Pafd Total in Force to Policybolders to Pol ,a- ‘ ' W. H. SomzaviLLx, General Manager to make Mutual Life ps underwriters of life agency force is com â€"â€"â€"â€"â€"$ 1,200,000.00 4,157,523.97 the fie all $ 4,286,493.65 4,286,493.65 271,650,475.90 1,223,194.66 Sise, Montreal, $ 11,853,105.72 $ 5,034,91L.56 $132,198,392.72 $ 44,038,582.00 $517,967,974.00 fl T N o ho 4 "@f At a meeting of the <Board held subsequent u"&. Annual Iw Mr. R. 0. McCulloch was reâ€"e es P rpcioent. and Hon." §E 2 6â€"Presiden on. . Mew. bnrn,PEC.. Second Viceâ€"President. The retiring members of the Board â€" Messrs. R. O. McCulloch, L. L. Lang, Glyn Osler, K.C., W. J. Blake Wilson and W. H. Somerville â€"were reâ€"elected. insurance in the true sense of the term. $upplemen::n.'l the tv’:;).fllr‘ in our various agene o n members of our Head ngflce stl? delivered instructive addresses in al our Canadian offices last year. The Board of Directors reforted new assurance issued and rd for amounting to $44,088,582, with total assurances in foree increased to $517,967,974. Tota! cash income for the {en was $27,520,697, and total disburaments to poligboldon and beneficiaries $17,146,547, an increase of $2,482,173 over the pre» vious year. The Commy'n assets increased over $6,850, to a total of $132,198,392. 8u:rlm earnings amounted to $5,509,688. $ 5,357,523.97 $ 9,651,328.41 4,293,804.44