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”’[‘Surplus Earnings of 1925 Hig hest on Recor I wish to join with the President in his expression of sincere regret for the illness and resignation of Mr. Charles Ruby, late General Manager of the Company. Mr. Ruby has been connected with the Company since 1884, was made actuary in 1902, secâ€" retary in 1907, general manager in 1918 and elected to the Board of Directors in 1925, and in all his varâ€" ious activities has given very valued service to the Company. I am sure that we all sincerely hope that he will soon be restored to health and may he long be spared to enjoy a well earned rest. In Mr. W. H. Somerville the Company has, I beâ€" lieve, found a worthy successor and will continue to prosper exceedingly >under his management. Low Mortality Turning to the report of the busiâ€" ness of the past year, I am sure we are all very much gratified with thei progress attained by theâ€"Company. We have again been blessed with| low mortality, 37.95¢, of the expectâ€" ed, with increased business and a low expense ratio of 15.23¢,; we‘ have maintained the rate of interest earned in our invested funds and the wastage from lapsation has been reduced. Everywhere we have made gains, and as the report has disâ€" closed we have completed our year with the best net return and have carried forward the. largest surâ€" plus earnings in the history of the Company, a credit to our efficient and economic management. As a purely mutual company, our object is to furnish sound life insurance at the least possible cost and the profit on the year‘s operations is the most important item, for it is from that source that dividendsf to policyholders are derived. The} surplus â€" earnings for the â€" year 19%5 reached the . splendid sum. of $3,796.982.41, _ representing _ $52.36 per $1,000.00 of total assets. Assets Increased The assets of the Company have increased from the sum of $65,960, 766.85 to $72,517,565.56. These conâ€" sist mainly of mortgages and bonds.l Our mortgages has increased from| $21,553,716.74 to $24,619,520.51 and| gur bonds have increased from $28,â€" 209,809.55 to $30,461,675.62. For the past year the rate of interest earned on our invested funds is 642¢, as against 6.419, for the past year 1924.| On December 31st, 1925, the as sets of the Company and the per centage which each class of invest ment bears to the whole was as fol lows: Mortgages ... Bonds ....silccue Loans on policies Real Estate ... And other assets of the following Government and Government Guaranteed . OE .lsn clsiuns P i0.o en entcececarniereimmenerciony Towns and villages ... mamscipeemele Townships, districts & rural municipalities COUNUIGS s ...sol.co0 sls ocm emmeinmerenetamieipeigss RBCROOIS . ...............cccll ssm Rural TeéelephOnes ........«..culllssczcmcmmmnnse R&IIWBYS ... ~.0000micnnnollnninerercennnisicemecitss RAUStTIAI® | ... ce es Public _ UHIItY | .....:....:.sslcomlcusclocmatancene M48C@IIAN@OUS | ... It will be noted that mortgages, bonds, policy loans and cash conâ€" stitute 92.679, of the total. The Company‘s bond investment at December 31st, 1925, consisted The average term of these bonds is about 20 years and the average interest earned on them during the past year was 5.85¢. The Company‘s Eastern mortzage investments increased from $9.194,â€" 427.51 at December 31st, 1924, to $12,054,818.72 at December 31st, 1925, and the Western mortgage inâ€" vestments increased from $12.359,â€" 289.23 at the end of 1924 to $12.564,â€" 701.79 at the end of 1925. * Investment Reserve Attention should again be drawn to the fact that the Company has set up a special investment reserve of $850,000.00 to cover possible deâ€" preciation in its investments and that the Company‘s bonds have at the present time a substantial apâ€" preciation of $2,006,476.75 in accordâ€" ance with the value fixed by the Dominion Department of Insurance above the figure at which they are earried in the Company‘s books as at December 31st, 1925. â€" Figures for the year show that our policy loans have increased from $10,155,081.41 as at December The Viceâ€"President, Mr. R. O McCulloch, then seconded the mo tion in the following address:â€" Remarks of Viceâ€"Presid ent ’I R. 0. McCulloch on the industry and the thrift of \‘lhr‘ nation obviously no matter what | ita yield is, it is a tax that ought to be avoided except in cases of direct | distress. That is just as true of the | excessive taxes on earned income as it is of an inappropriate tax on Nh. J M. LAING ALA. F.A.s. savings bank accounts or insurance Actwary of The Mutual Life Assurâ€" policies or any other method of ance Company. thrift that the neonle may #ener Total Exceptional Surplus Earnings of $3,796.982.41, an Increase of $296,724.41 over the Previous Year.â€"Will Enable Company * ® to Continue Same Liberal Scale of Dividends to Policyholders. There is increased interest in farm lands in Western Canada and many properties have been sold. There is plenty of moisture for next year and an average of summerâ€" fallow, and although there was some delay in fall plowing, caused by the bad weather, the acreage turned overâ€" will be but slightly less. _ There is noticable increase in mixed farming, and generally speakâ€" ing the West has entirely recovered its confidence and should be an exâ€" cellent field of investment in good districts where security is unquesâ€" tioned. The older provinces were also blessed with bountiful harvests and as prices were good the returns were satisfactory. . Agriculture ,our leading industry, is in a sound position. The returns from the Prairie Province have been very satisfactory, much more so than was anticipated by reason of the delay in harvesting, occasioned by unfavorable weather conditions, but these conditions were followed by good weather, which enabled the harvest to be completed, and in the intervening time prices of grains materially advanced. tively The total value of the principal field crops of Canada for 1925 given in the final crop report issued on January 25th, 1926, by the Dominion Bureau of Statistics, is estimated at $1,159,361,900, as compared with final estimates for 1924 and 1923 of $995,235,000 and $899,226,200 respecâ€" We are all widely interested in the welfare of our country and I feel that is is right and proper that atâ€" tention should again be drawn to the tremendous ~burden of existing taxation. While the resources of Canada are immense and we have great wealth, our taxation is unquesâ€" tionably excessive and not only inâ€" jurious to our policyholders but to all industry and thrift. Accompanied by Mr. Bowman, 1 had the privilege of attending the 19th Annual Meeting of the Associaâ€" tion of Life Insurance Presidents, held in New York on the 3rd and 4th of December last, and two papers were read on the subject of taxation, one having the atriking title of "Menace of Taxation to Life Insurance." The address of the Hon. David A. Reid, United States Senator from Pennsylvania, was exâ€" ceedingly appropriate, and as he exâ€" presses my own jdeas much better than [ could I do not think I could "A sane system of taxation must consider not only the éase of collecâ€" tion but the effect of the tax upon the industry and the life of the naâ€" tion, and that comes back, of course, is toâ€"day greater confidence throughâ€" out the whole Dominion than there has been for some years. I believe we have turned the corner and passed through the worst of our bad times we are now headed towards better general conditions and years of prosperity. to such matters as earned income and to such matters as drying up the source of taxation. If your 3 is going to have deadening off Tur"lamg to general conditions in Canadh, it may be fairly stated, I think, that business on the whole in Canada has shown some improveâ€" ment: in1925. The trend has been slowly but surely upward, and there do better than quote from his paper He said: The Mutual Life Assurance Comâ€" pany performs a great service not only to its policyholders, encouragâ€" ing thrift and eeonomy and preparâ€" ing against conditions arising from death or disability, but also in colâ€" lecting annually large amount of money and investing it from time to time in various parts of the country, and thus assisting in its upbuildâ€" ing. Last year it invested the sum of $10,672,686.21 and paid to its polâ€" icyholders the sum of $7,620,783.10. 3ist, 1924, to $11,151,191.80 at Bec ember 31st, 1925, although the per centage is practically the same, be ing 15.37% as against 15.4%. Attention has been drawn to the undesirability of our policyholders borrowing on their policies, but there is as yet no substantial imâ€" provement in this regard. Taxation Too High West Looks Good Book Value Market Value $14,277,034.29 $12,350,790.67 6,496,987.92 . 6,899,564.20 3,030,394.05 . 3,158,768.85 1.550.571.80 _ 1,663,177,92 $30,378,768.92 $24,619,520.51 30,461.675.62 11,151,191.80 1,843,651.10 $72,517,565.56 907,044.45 2,534,281.98 1,214,251.77 750,644.11 201,575.00 902,854.26 1,514,029.29 969,623.56 3,471,902.97 $32,385,245.67 979,802.12 2,591,733.67 1,279,029.16 765,270.00 202,500.00 929,730.00 1,564,878.48 1009 33.959% 42.01 15.37 2.54 1.34 4.79 "In talking with you it seems to me that I sense those millions of people whom you represent, your policyholders and your employees. It seems to me that your influence. on the Government is often greater than you realize and that when you promuigate sound doctrine you are irresistible in your effect upon the men who determine Government policies, that if you promulgate sound doctrine of tax reform it is inevitable that that should come to pass. That is why I hope that it may at least color what you send to your policyholders, this collection that an excessive tax on the inâ€" dustry of the people has its reflecâ€" ally have resort to. Heavy taxation on such sources as that inevitably has the effect of drying up the source. It is selfâ€"evident even to Western Progressive politicians that a tax of 100¢, on earned income means that nobody. will work. It is selfâ€"evident even to such hopeless reactionaries from the East as myâ€" seif that a tax of nothing on income will yield no revenue. Somewhere between these two lies a happy meâ€" dium and in my judgment that hapâ€" py medium liee away below the level of rates that we now have adopted. Former General Manager of The Mutual Life Assurance Company. MR. CHARLES RUBY On motion of Mr. T. A. Russell, seconded by Mr. L. J. Breithaupt, a cordial vote of thanks was exâ€" tended to the agency force for their services. After passing‘ this business the meeting adjourned. ~ On motion of Mr. H. J. Sims, secâ€" onded by Mr. R~8. Bean, $1,000 was appropriated to the Kitchener and Waterloo Y.M.C.A. tion in excessive taxation on their thrift, that excessive income taxaâ€" tion and excessive estate taxation march hand in hand and that we can to the great profit not only of your industry but the industry of all the nation lower them both to a point that experience has shown is most protective and least oppresâ€" sive. P > "In the long run I say you are ir resistible if you preach sound ,doc trine. I hope you will use your in fluence and use it that way." [ have pleasure in seconding the adoption of the report. , GRANTS MADE FOR LIFE EXTENSION RESEARCH WORK.â€"OTHER GRANTS On_motion of Mr. Hugh Cannell, seconded by Mr. J. Leslie McDuff, $3,000 was appropriated to the fund for combatting the white plague in the Maritime provinces. On motion of Dr. J. P. Honsbergâ€" er. seconded by Mr. W. D. Sheldon, the sum of $10,000 was granted to the Banting Research Foundation in view of the greatly improved mortalâ€" ity resulting from the use of insulin. YEAR 1885 1895 1905 1915 1925 1875 Indicative of the impregnable financial situation of the Company is the $6,556.800 increase in accumulated assets, which now total $72,517,566, as against $65,950,767 at the end of 1924. By every test, the principle of Mutualityâ€"whereby the profitâ€"particiâ€" pating Policyholders receive back the entire net profitsâ€"justifies confidence in the continuance of benefits to Mutualists in the coming years. Although throughout last year the trend in bond srices was toward higher figures (with consequently lower yields), cougle with a tendency toward lower rates of interest on mortgage loans, the Company was able not only to maintain the average rate of interest :&ned on its invested funds, but to make a slight increase to 6.42%. An extraordinarily low rate of mortality was experienced in 1924, the actual death strain being only 36.01% of the expected, so that although the death claims paid in 1925 exceeded those of 1924, the mortality ratioâ€"37.95% â€"was still very favorable. Pioneer Mutual Company Has Record Sum for Distribution ~ to its Policyholders This economy in administration was one factor contributing to the exceptionally high surplus earned for Mutual Policyholders. Very favorable mortality and an equally favorable interest rate on invested assets were other factors. _ $3,796,982 Surplus Earnings in 1925 Shows Exceptional Strength of the Mutual Life of Canada ~__ Our Policyholdersâ€"who alone constitute the Companyâ€"rightly judge the strength and progress of the Mutual Life of Canada by its surplus earnings from year to year. The surplus earned by this Comâ€" pany during 1925 totalled $3,796,982.41â€"an increase of $296,724.41 over the surplus earned in 1924, in which year all previous highâ€" water marks were far surpassed. These remarkably favorable earnâ€" ings will enable the Company to continue to pay dividends to Policyâ€" holders on the same liberal‘ scale in 1926 as heretofore, and, in addition, the free surplus available for contingencies has been increased by $607,981.91. The amount paid to Policyholders in 1925 was $7,201,403, an increase of $969,252 over the 1924 total. Steady, Safe Growth in Business THE 56th year in the history of the Mutual Life Assurance Company of Canada was marked by solid and substantial progress. It is gratifying to note from the reports made to the policyholders at the annual meeting on February 4th that the 1925 operations of Canada‘s pioneer Mutual Life Company compare very favorably with the record results achieved in 1924. ‘The 56th mileâ€" stone in Mutuality marks 56 years of unbroken prosperity. Healthy expansion of the Company‘s business is again recorded for 1925, by the end of which year the total in force amounted to $322,529,285. At the end of 1924 the assurances in force totalled $295,729,866, so that 1926 showed a net increase of $26,799,419. The total new issue for last year was $45,573,577â€"an increase of $2,249,280 over the 1924 volume of new business. . Notwithstanding thi§g very considerable increase the expense ratioâ€"already notably lowâ€"was again reduced on 1925 busingss. The percentage of income required to cover general expenstfas cut from 15.50% in 1924 to 15.23%‘in 1925. Progress of the Company $ 29,5%4 270,697 735,080 1,956,519 4,972,782 16,474,886 INCOME Low Mortality and Higher Interest The scrutineers reported the reâ€" election of and the election to the Board of the nominees mentioned above. INCREASE BOARD OF _ DIRECTORS TO FIFTEEN The following Directors were nominated for reâ€"election by Viceâ€" President R. O.â€" McCulloch â€" Sir Lomer Gouin, W. G. Watson, Charles Ruby and Hume Cronyn, K.C., and as new members â€" Hon. J. Fred Frase#, Halifax, N.S8., Isaac Pitblado, K.C., Winnipeg, Man., and W. J. Blake Wilson, Vancouver, B.C. On motion of Mr. W. J. Twiss and Mr. Fred M. McGregor, Messrs. 8. J. Adams and A. E. Pequegnat were appointed scrutineers. Mr. Fred M. McGregor, Messrs. 8. J.| To The Policyholders of The Mutual Adams and A. Eâ€" Pequegnat were| Life Assurance Co. of Canada, appointed scrutineers. I also desire to express the sorrow Pending the report of the scruâ€"| and regret, which we all have exâ€" tineers, Messrs. E. Morwick. J. P. perienced, on account of the serious Jaffray, S. Burrows and others conâ€"/ jliness of Mr. Charles Ruby, which tributed interesting comments. has deprived The Mutual Life Asâ€" The scrutineers reported the reâ€"| surance Company of his ripe experiâ€" election of and the election to the| ence and counsel as General Manâ€" Board of the nominees mentioned | ager, Mr. Ruby.jn my judgment posâ€" above. sesed a knowledge of the sound Three new byâ€"laws were then apâ€"| principles and science of Life Inâ€" proved by the meeting. surance that has never been surâ€" 1. Increasing the number of Dire¢â€"| passed in Canada. Mr. Ruby assumâ€" tors from twelve to fifteen on m0â€"| ed the position of General Manager tion of Mr. G. G. Mills, seconded by | of the Mutual Life at a very critical Mr. G. J. A. Reany. time, when war and the "flu" losses 2. Creating the office of Chairma@n| made a heavy drain on the resources of the Board on motion of Mr. J. Pâ€"| of The Mutual Life, as on all other Jaffray, seconded by Mr. H. O.| Canadian companies, but he thought Hawke. the company through this time of 3. Regarding adequate remuner@â€"/ stress and strain in a very successâ€" tion for members of the Board, 0| ful manner, and has the proud satâ€" motion of Mr. G. G. Mills, seconded ) jsfaction of knowing that during by Mr. C. E. German, that period of less than eight years Appointed Chairman of Board in which he occupied the position of A byâ€"law was passed creating the} Genefal Manager the annual income new office of Chairman of the Board| rose from $7,021,103.00 to $16,474,â€" of Directors, Mr. C. M. Bowman beâ€"| $85.00, an increase of 134.65%, the ing selected for the position. The|assets from $34,755,736.00 to $72,â€" appointment of Mr. Bowman to this| 517,565.00 an increase of 108.659 honored position by Canada‘s blS'[ business in force from $137,640,000.00 gest and greatest mutually owned| to $322,529,000.00 an increase of insurance company is a distinct| 134.33q¢, and what is of still more tribute to him. There is no doubt/importance to the policyholders of that the company would have to| The Mutual Life is the fact that look far and wide to find the peer Charles Ruby as General Manager of Mr. Bowman for this position. built up a monument to faithful Pending the report of the scru tineers, Messrs. E. Morwick. J. P Jaffray, S. Burrows and others con: tributed interesting comments. 1. Increasing the number of Direcâ€" tors from twelve to fifteen on moâ€" tion of Mr. G. G. Mills, seconded by Mr. G. J. A. Reany. 2. Creating the office of Chairman of the Board on motion of Mr. J. P. Jaffray, seconded by Mr. H. O. Hawke. Assets Steadily Increase $ 53.681 750,344 3,123,575 9,296,092 26,894,524 72,517,566 ASSETS w 1 PAID TO POLICYHOLDERS $ 4,625 115,669 328,829 552,914 2,035,814 7,620,783 The chairman ‘of the Executive also supported the motion commentâ€" ing «s followsâ€" Address of C. M. Bowman, Chairman of Board Tribute to Staff $ 1,177,08 8,259,361 19,312, 477 44,197,954 101,092,030 322,529,285 BUSINESS IN FORCE ed the feeling of confidence proâ€" duced by the profitable crop of 1924. serviceâ€"A Mutual Life Assurance Company of Canada bigger and strongeir in every wayâ€"than the Mutual Life Assurance of Canads which was placed in his charge in 1918. It must be a great source of satisfaction to the policyhoiders of The Mutual Life to find their comâ€" pany so well staffed at Head Office thatâ€"todayâ€"as was the case in 1918 when Mr. Ruby was appointed to succeed George Wegenastâ€"a sueâ€" cessor to Mr/ Ruby has been found within the walls of the Head Office building of The Mutual Life in the person of Mr. W. H. Somervilie who through twentyâ€"six years of service at the Head Office has become thorâ€" oughly grounded in the history, traditions and policy of the Comâ€" pany. The present and future policyâ€" holders of The Mutual Life can rest assured that under the management of Mr. Somerville and those assoâ€" ciated with him the Company will continue to furnish the people of Canada in increasing volume year by year with the highest type of life insurance service which it is fully recognized has been furnished by The Mutual Life in the past. 1924 Turning Point The prediction which was made last year at the Annual Meeting of The Mutual Life that the year 1924 will go down in history as markâ€" ing the turning point for Western Cangda, has now become an acepted fact as the magnificent crop of 1925 which is being marketed at very satâ€" istfactory â€"prices has greatly increasâ€" years we have been erecting a new and sounder foundation for our future economic growth; that as a country we have learned some of these economic lessons that adâ€" verse conditions have forced to our attention, and that finally, aided by That the â€" readjustment period (1920â€"1923) following the close of the war during which Canada along with all other nations suffered, may have its compensations is very aptâ€" ly expressed in the Montreal Gazâ€" ette‘s Commercial and â€" Financial Review for1925 by the President of the Canadian Pacific Railway in the following words: The annual Western investment trip made last fall by the Cbairman of the Executive accompanied by "Itâ€"will probably come to be seen that for the past two or three a bountiful crop and by slow but sure betterment of overseas marâ€" kets for our products, which have combined to increase the monetary wealth of the country, we have come to a ‘position where we await some impetus to revivify our domestic trade." The large amount of new wealth resulting from the agricultural proâ€" duction of 1925 coupled with the very pronounced impetus during the year in the development of water powers, mineral and timber reâ€" sources which hitherto have proâ€" duced no revenue, has brought about such a marked revival of Canâ€" adian domestic trade during recent months that it is now quite evident that Canada is approaching a period of prosperity which should be greatâ€" ly accelerated by a steady flow of immigration in good value from the British Isles, Continental Rurope and the United States as it is very gratifying to learn that the prosâ€" pects for increased fmmigration apâ€" pear to be brighter today than they have for some years. The fact that the repayments which The Mutnal Life received durâ€" ing 1925 on account of mortgage principal from the provinces of Manitoba, â€" Saskatch@wan and _ Alâ€" berta amounted to 12.79¢, of the toâ€" tal mortgage investments which the Company hadâ€"in these three provâ€" inces, ag January ist, 1925, and that during the year 70.527, of the farms in these three provinces to which the Company had received title have been sold for an amount aggregating considerably more than these same farms were carried as an asset furâ€" nishes very positive evidence of the remarkable improvement in Westâ€" ern Canada during 1924 and 1925. This record is very gratifying and justifick the unwavering faith and/ confidence of The Mutual Life in Wost»r2r(‘annda. Owing to the rapid adoption of better farming methods and a greater diversification of proâ€" duection. _ agriculture _ in _ Western Canada is «now placed on a much more permanent basis. MR. H. M. COOK Secretary of The Mutu (Continued on Page 9) iry of The Mutual Life Assurance Company. New Wealth Created