Fireman's Fund

Jacob Bertha Levison, 75, somewhat resembles the eminent flutist Georges Barrere in his close-cropped, courtly white beard and twinkling eyes. He too plays the flute, but this and his long patronage of music in San Francisco are matters of diversion. For 60 years Mr. Levison's business has been with disaster by land & sea. Fortnight ago he retired from the presidency to the chairmanship of San Francisco's famed Fireman's Fund Insurance Co. Last week its two main subsidiaries confirmed him in the same change of office. Having thus ended 20 years in active management of the second largest marine underwriter in the U. S. and the largest insurance company on the Pacific Coast, Mr. Levison dived into the den of his huge old house overlooking San Francisco Bay to read thousands of congratulatory messages.

Like most forms of business civilization, fire insurance came late to San Francisco. A wild and wastrel town slapped together on the promise of the Gold Rush, it went up in flames six times between 1849 and 1851 with a total property loss of about $20,000,000. San Francisco gentlemen then organized volunteer fire brigades whose uniforms outdazzled those of the Vigilantes and whose members fought freely for the privilege of breaking the first window at a blaze. For twelve years these fraternities added to the excitement of a city where it was noted that "a man cannot walk home of an evening without his head being round all quarters at once, on the lookout for a slung shot." In 1862 San Francisco acquired its first paid fire department. The next year a retired sea captain named William Holdredge started Fireman's Fund Insurance Co.

Neither Captain Holdredge nor the storekeepers on his board of directors knew anything about insurance, but they "had one simple, brilliant idea. This was to pay 10% of the net profits to the charitable fund of the San Francisco Fire Department and to mark all buildings insured by the company with a metal "house plate." Since they had a financial interest in the company, firemen were expected to surpass themselves putting out fires in these buildings. Whether aided by this or not, the new company did so well in fiery San Francisco that two years later it decided to get along without the Fire Department, donated $5,000 cash to the fund and abandoned the 10% payment plan. But the name of the company stuck.

In October 1871, the legendary Mrs. O'Leary's cow kicked over a lantern in the city of Chicago and caused the great $200,000,000 fire. In the next few months 68 U. S. insurance companies failed and 81 were forced to suspend business outside their own States. To pay off claims against it of $529,365 required not only every cent of Fireman's Fund capital but an assessment on its stockholders. Chairman Levison likes to boast of this as the first time the company went broke and yet survived. The second time was after the Great San Francisco earthquake and fire in 1906. and this time Mr. Levison played a principal part in the rescue.

On the evening of April 21, 1906, Fireman's Fund, with a capital of $1,000,000 and assets of $7,000,000, owed its policyholders in the smoldering city more than $11,000,000. Then vice president in charge of the marine division, Jacob Levison proposed the formation of a new company to take over the insurance of the old, minus San Francisco losses. Each director was asked to subscribe to stock in the new corporation in a ratio of twice the amount of the par value of his former holdings. All but one agreed. Mr. Levison made their subscription notes security for a $250,000 loan from the Crocker-Woolworth Bank. To policyholders he offered 50% in cash and 50% in stock of the new company. On every stockholder he levied a $300 assessment. Mr. Levison's plan worked. Fourteen months after the fire, Fireman's Fund Insurance Co. had assets of $5,345,000, cash capital of $1,600,000 and a surplus over all liabilities. It was the only insurance company ever to survive the destruction of its home city.

With 10,000 agents in the U. S. and a sprinkling in Europe, South America, Africa, Asia, Hawaii, Australia, New Zealand and Arabia, Fireman's Fund is now sixth in volume of premiums among all U. S. insurance companies. Premium income on its underwritings has risen from $12,658,000 in 1933 to $16,326,000 in 1936. Fire insurance is now its smallest field, ocean marine its largest. It writes all forms of insurance except life. Mr. Levison's successor as president of the com-pany is tall, bald Yaleman Charles R. Page. 59, who has been in Mr. Levison's old division of marine insurance ever since he left college, except for three years as a Commissioner of the U. S. Shipping Board during the War.

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