Lloyd's yesterday and to-day

Robert E. Gross
Colleftion

A Memorial to the Founder
of the

Business Administration Library
4 Los Angeles

ft

LLOYD'S

YESTERDAY and TO-DAY

BY

HENRY M GREY

ILLUSTRATED BY
W. D. ALMOND

LONDON

JOHN HADDON & CO

MDCCCXCIII

Gross Collection
Bus. Adm. Lib.

hi Q

PREFACE

'"T^HE present sketch of one of the most in-
teresting and important commercial bodies
in existence originally appeared, in skeleton, in
the Illustrated London News. The numbers in
which the article was published are now out of
print, and in reproducing it in this more permanent
form, I have added a quantity of detail which
the limits of an article compel one to omit. I
take this opportunity of expressing my gratitude
to the proprietors of that journal for their kind-
ness and courtesy, in granting me permission to
use the original letterpress and blocks. My thanks
are also due to those friends who have assisted
me from the store of their personal reminiscences.

H. M. G.

Chelsea, April., 1893.

/^ \1 ICS

CONTENTS

CHAPTER I.

PAGE

Early Days 7

CHAPTER H.
Rise of Lloyd's 2i

CHAPTER HI.
To-day 39

CHAPTER IV.
Insurance Frauds 67

CHAPTER V.
The "Room" 82

Gross Collection
Bus^ Adm. Lib.

The following books and pamphlets have been
consulted in the compilation of the present
work : —

Annals of Lloyd's Register.

Martin's History of Lloyd's attd Marine Lnsiirance,

Lloyd's Report for 1884.

Hints to Captains of the Mercantile Marine.

Dick's Marine Lnsurance, Popularly Treated.

Ivindsay's History of Merchant Shipping and
Ancient Commerce.

Van de Linde's Biography of a Policy.

16^19165

Coffee, which makes the politician wise,
And see through all things with his half-shut eyes.

POPF.

LLOYD'S YESTERDAY AND TO-DAY.

CHAPTER I.

EARLY DAYS.

^T^OWERING head and shoulders above the
-*- crowd of institutions that have helped to
make this country great, and win for her the
maritime supremacy of the world, stands the Cor-
poration of Lloyd's. The name is familiar in our
mouths as household words, but how few there are
who know anything really definite of its origin, or
of what goes on within its walls to-day ! Yet the
history of this time-honoured institution is closely
bound up with the commercial history of this
country ; and, supposing that, by some impossible
combination of circumstances, its doors were to be
closed to-morrow, its collapse would be, perhaps,
more widely felt than that of any other commercial
institution in the world. But as great rivers often
trace their sources to the smallest of streamlets, so
this mighty institution sprang from the humble
origin of a riverside coffee-house.

At the close of the seventeenth century, Tower
Street was one of the principal thoroughfares in the
City of London, and there it was that Edward
Lloyd, from whom the world-famous institution

8 LLOYD'S YESTERDAY AND TO-DAY

takes its name, established his coffee-house. The
date usually assigned to the first existence of the
establishment is 1710, but this is undoubtedly
incorrect, for in No. 2,429 of the London Gazette
may be found the following curious advertise-
ment : —

" On the loth instant a middle-sized Man,
having black curled Hair, Pockholes in his Face,
an old brown riding Coat, and a black Bever Hat,
was suspected to have taken away five Watches."
Here follows a description of them, and the adver-
tisement concludes : — " Whoever gives Notice of
them to Mr. Edward Lloyd at his Coffee-house
in Tower-street, or to Mr. Edward Bransby in
Darby, shall have a Guinea Reward." The date
of this is 1688, when the place was, no doubt, a
common resort of seafaring men. Tower Street
was the main thoroughfare between Wapping
and the centre of shipping activity on Thames
side, and the City ; and the immediate neigh-
bourhood embraced, as it does now, the Custom
House, Billingsgate, and Trinity House. Sailors
landing at St. Katharine's, or " Galley Key,"
would naturally patronise the nearest place of
entertainment, and in this way it is easy to see
how Lloyd's first became identified with the ship-
ping interest. The advertisements in the London
Gazette of that time tend to show that Lloyd's
clientele was in those days largely composed
of seafaring persons. Some of them are curious
reading, as witness No. 2,495, ^-D. 1689 : — " Run
away from Captain John Brady 1, a Tawny Moor,

EARLY DAYS

about twenty years of age, bow-Legged, with a light-
colour'd Coat, a white Wastecoat, and a pair of
Shammy Breeches. Whoever gives Notice of him
at the aforesaid Captain's House on Rotherhithe
Wall, or at Mr. Lloyd's Coffee-house in Tower-
street, shall have 20s. Reward, and their Charges."
Again, in March, 1690, No. 2,643 • — " R^" from on
Ship-board a Negro named Will, aged about
22 ; he had a grey Suit, and speaks English
well. Whoever secures him, and gives Notice
to Mr. Lloyd at his Coffee-house in Tower Street,
London, shall have a Guinea Reward." But the
identification of Lloyd's Coffee-house with marine
insurance had not yet begun.

In 1692 Mr. Lloyd removed his establishment
to the corner of Lombard Street and Abchurch
Lane, a few doors from the General Post Office, and
nearer the centre of the commercial life of the
City. The removal westward, though it involved
the loss of patronage by the seafaring section of
the community, was, nevertheless, a step nearer
prosperity, as Lloyd gained more than he lost in
the acquisition of the custom of merchants of
standing. Still, Lloyd's was only one of a number
of such houses, having for rivals Caraway's, Jona-
than's, Baker's, and others, in Exchange Alley
which, a chronicler of the period states, were chiefly
frequented by " Brokers, Stock-jobbers, Frenchmen,
Jews, as well as other Merchants and Gentlemen,"
John's Coffee-house, too, was a celebrated one in
those days ; but Baker's is the only one, besides
Lloyd's, which has descended to our day. Lloyd,

lo LLOYD'S YESTERDAY AND TO-DAY

by his energy and activity, soon succeeded in
gathering round him a considerable clientele, and
the records of the period contain frequent adver-
tisements of sales by " inch of candle," which took
place at this tavern.

One day it would be " A fine fresh Stone-horse,
just come out of Yorkshire, 60 guineas value, to be
thrown for by Dice, each lot a Guinea " that would
be put up for sale ; another day "The St. Joseph,
a prize, with her Cargo, Sugar, Indico, and
Anatto " ; and again, " a parcel of Turkey Coffee,"
that drew people to Lloyd's establishment. It
seems to have been the favourite delivery-house
of runaway slaves, even up to 1703, when the
" Postman " notified all and sundry that " A negro
maid, aged about sixteen years, named Bess, having
on a striped stuff Wastcoat and Peticoat, is much
pick't with the Small Pox, and hath lost a piece
of her Left Ear, speaks English well, ran away
from her Master, Captain Benj. Quelch on Tues-
day, the 8th December." Smallpox marks do not
appear to have been, in those days, a very distin-
guishing characteristic, but the loss of part of an
ear would no doubt lead more readily to identifi-
cation. Reference is made to these sales in a
" poem " called "The Wealthy Shopkeeper," pub-
lished in 1700 : —

" Now to Lloyd's Coffee-house he never fails
To read the letters and attend the sales."

The " letters " here referred to were very possibly
a distinguishing feature of Lloyd's Coffee-house

EARLY DAYS w

— at any rate, he seems to have given them much
more prominence than his rivals. Lloyd had
established quite an extensive connection of home
and foreign correspondents in the principal ports
of the time, and from these he received constant
news of the movements of vessels, and other
matters of interest to his clients, which was duly
posted up in his establishment. In this fact may
be found the germ of the " Lloyd's List " we are
familiar with to-day, and the foundation of the
subsequent greatness of the Corporation of Lloyd's.
Ten years later, Lloyd's was the subject of a
paper by Steele in the Tatler, and a year later,
Addison employed his powerful pen on the same
subject in the Spectator. The latter described
what he calls an " odd accident " which happened
to him there. Addison, it seems, was accustomed
to make voluminous notes of thoughts which
occurred to him during the day, and it so happened
that he dropped this " whole sheetful of hints " on
the occasion of his visit to Lloyd's, and before he
had missed it, it had been found by a cluster of
people, who were diverting themselves with its
contents. In consequence of the merriment its
perusal evoked, Addison had not the courage to
claim it, and nobody being found to own it, the
Kidney ^ mounted the pulpit, and read it aloud to
the whole room. " The reading of this paper," he
says, " made the whole Coffee-house very merry :
some of them concluded it was written by a mad-
man." The article wound up with a sketch of the
' Waiter.

12 LLOYD'S YESTERDAY AND TO-DAY

visitors at Lloyd's, which, as may be imagined, was
more personal than polite.

Lloyd's removal westward paved the way for
greater undertakings than the sales above de-
scribed, for, as his house became more and more
the resort of persons connected with shipping, his
enterprise found more and more encouragement,
and the year 1696 saw the establishment of a
newspaper, published three times a week, giving
shipping and commercial news, and known as
Lloyd's Neivs. This was a huge undertaking, for,
in those days, nothing of the kind existed, except
the official London Gazette. Private enterprise
might, perhaps, earlier have started something in
the way of a news sheet, but the liberty to do so
was wanting, as no man had the right to publish
political news without the authority of the Crown.
Even the Gazette itself only gave the most meagre
apology for news. A description of a cockfight,
or a " wanted " highwayman might perhaps be
read, but the events which go to make history
were unnoticed, and the report of a parliamentary
debate was a thing unknown.

The gossip of the day centred at the coffee-
houses, and these places came to be recognised
as the head-quarters of news. So much so, indeed,
that a royal ordinance of Charles II. summarily
ordered the shutting up of all coffee-houses. An
appeal to the law courts followed, and ultimately
permission was granted to the " masters " of coffee-
houses to keep them open, on condition that they
should " prevent all scandalous papers, books.

EARLY DAYS

and libels, from being read in them, and hinder
every person from declaring, uttering, or divulging
all manner of false and scandalous reports against
the Government or the Ministers thereof" The
publication of this news sheet was therefore a
very courageous undertaking, and later on, as
will be seen, Mr. Lloyd paid the penalty of his
rashness. A complete file of the paper does not
exist, but the Bodleian Library at Oxford contains
all but the first seven numbers.

The journal, however, had only a short career,
for in the seventy-sixth number some very harm-
less information was inserted concerning the pro-
ceedings in the House of Lords. For this heinous
offence Mr. Lloyd was summoned to appear be-
fore the bar of the House, and being there in-
formed that the statement made in his paper was
" groundless and a mistake," was called upon to
" rectifie it in his next." This he never did, saying
he would " print no more at present." The course
he took may seem rather Quixotic for an enter-
prising pressman, to suppress his journal rather
than knuckle under to the Government, but the
suppression was in form rather than in fact. He
merely substituted handwriting for printing, and
the news sheet continued to be read at Lloyd's
Coffee-house. This continued for nearly thirty
years, until in 1726 the journal was revived under
the title of Lloyd's List, the publication of which
— though under a different name since 1884 — has
been continued down to the present day. Lloyd's
List can therefore claim to be the oldest news-

14 LLOYD'S YESTERDAY AND TO-DAY

paper now in existence, with the single exception
of the official London Gazette.

Meanwhile the suppression of Lloyd's Netvs does
not seem to have interfered with the prosperity of
the Coffee-house, which continued to increase with
every year. Lloyd's had by this time, in con-
sequence of prominence given to shipping matters,
come to be recognised as the centre of marine
insurance ; but this branch of business was not, as
yet, of the first importance there, being secondary
to that of the collection and dissemination of news.
The insurance of ships as a regular business would
appear to have been only one of the numerous
excuses for speculation to which the South Sea
Bubble had given rise. All sorts of curious
schemes were floated about that period, such as
" Assurance from Lying," " Rum Assurance,"
" Assurance of Female Chastity," and many other
oddities more or less absurd, but all finding
support.

There is nothing new under the sun, but it
is interesting to note, in passing, that the modern
popular system of Burglary Insurance, which is
generally believed to be a product of nineteenth
century civilization, is only a servile imitation of
the " Insurance from housebreakers," which was
practised in the days of the South Sea Bubble.

But the desirability of merchants obtaining some
really sound system by which their property could
be insured against loss or damage, increased, and
marine insurance, as practised to-day, crept gradu-
ally into vogue : first by individuals assuming

EARLY DAYS 15

risks for premiums received on the strength of
their own good names, and afterwards by combi-
nations in the form of companies. And thus the
word " underwriter " first came to be included in
the English dictionary. The import of the term
is perhaps very little understood, even at this day,
outside the comparatively narrow circle of ship-
ping and insurance men, but those familiar with a
policy of marine insurance know that it derives its
origin from the fact, that those who accept the
risk, subscribe — or underwrite — their names at the
foot of the document.

The documents setting forth the undertakings
of the private names of those days were in writing.
Experience, however, proved that, when a claim
arose, these documents were capable of very
ambiguous interpretation, and the perils attendant
upon a sea voyage being so numerous, it was
found necessary to introduce clauses defining more
specifically the underwriter's liability. The growth
of technicalities tended to infuse into the business
of marine insurance something of the nature of an
expert profession, into what was originally merely
a commercial transaction. And the difficulties of
the conduct of business, between merchant and
underwriter, being thereby increased, the " marine
insurance broker " was called into existence.

Lloyd's Coffee-house was found to be a con-
venient exchange for merchants, underwriters, and
brokers, and thus a centre was established for the
carrying on of marine insurance business, the fre-
quenters assembling at their pleasure, but not yet

i6 LLOYD'S YESTERDAY AND TO-DAY

bound by any rules or regulations. As business
increased, however, the Coffee-house was found to
be insufficiently commodious, and about 1770 the
brokers and underwriters removed their rendezvous
to temporary quarters in Pope's Head Alley.
There was no idea of Lloyd's making a permanent
settlement here, and indeed, a very short time
sufficed to demonstrate that the premises were
utterly unsuitable for the requirements of the
society. The difficulty of acquiring premises
adapted to their needs was apparently almost as
great as it would be to-day, were the Corporation
under the necessity of seeking a fresh location.
Many efforts were made to secure a suitable home,
but they were apparently of a desultory character,
and met with no success. Towards the end of
1 77 1, however, the matter was taken seriously in
hand. Mr. M. K. Van Mierop, a prominent
member of the Coffee-house, called a meeting of
his fellow-members, and it was there resolved by
seventy-nine of them, the enterprising Dutchman
being in the chair, to build a " New Lloyd's " in
the event of their being unable to rent suitable
premises. These seventy-nine gentlemen put
down ;^ioo each, as an earnest of their good
intentions, and in the flame-charred minute-books
of Lloyd's their names may still be read, with one
single exception, where the fire has consumed the
signature, but left the amount of the contribu-
tion legible. Then the business of house-hunting
began in earnest.

In the early part of 1772 a general meeting

A BROKER OF YESTERDAY.
From an Etching by R. DtghioJi.

EARLY DAYS 17

of the " Subscribers to the Plan for the Building
or Removing to another House, for the more
Commodious Reception of the Gentlemen, Under-
writers, etc.," was held, when fifty-four of the
number attended, and the worthy Dutchman again
took the chair. At this meeting it was decided
to elect by ballot nine gentlemen, of whom any
five should compose a committee, to carry the
scheme into execution. Mr. Van Mierop headed
the list, and he and his colleagues were invested
with full powers to apply all, or any part of the
money subscribed, to bring about the attainment
of the object in view. It would be tedious to
follow the committee through all their trouble-
some negotiations and vexatious disappointments,
but it was not until the 24th November, 1773, that
the subscribers, in general meeting assembled,
approved the selection of the committee, and
agreed neni. con. to take the rooms then lately
occupied by the British Herring Fishery Company,
and described as a " very roomy and convenient
place over the north-west side of the Royal
Exchange," at the rent of ;^i8o per annum. And
thus it came about that the patrons of what,
barely a century ago, was merely a humble water-
side coffee-shop, established themselves on the
spot which has ever since been their habitation,
and formed a commercial organisation in the very
heart of the City of London, which is unique in
the history of the commerce of the world.

Mr. John Julius Angerstein — of German extrac-
tion, but a native of St. Petersburg — deserves

B

i8 LLOYD'S YESTERDAY AND TO-DAY

mention here, as being the immediate cause of the
removal to the Royal Exchange. Van Mierop's
Committee had come within an ace of taking some
premises in Freeman's Court, having in fact gone
so far as to pay the sum of one hundred guineas
on account of the lease, when Mr. Angerstein in-
tervened. He recognised the fact that Lloyd's
was a coming power in the commercial world, and
that, with removal, would come re-organisation ;
and he interfered to urge the desirability of obtain-
ing not only premises that were commodious, but
also a position that was central. The house in
Freeman's Court might have fulfilled the former
condition, but it scarcely did the latter, and Mr.
Angerstein's opposition was regarded as reason-
able. The house-hunting committee was, however,
sick of its duties, and disinclined to go to any
further trouble in the matter. So Mr. Angerstein
himself took it in hand, with the result that in a
short time he had the offer of the lease of the
rooms in the Royal Exchange from the owners of
the building, the Mercer's Company, on condition
that he would make himself personally responsible
for the rent. With remarkable public spirit he
accepted these extraordinary terms, and brokers
and underwriters thus found a permanent abiding-
place, to which they removed in 1774.

The money, subscribed by the seventy-nine
members, was therefore never required, Mr.
Angerstein, who was afterwards to distinguish him-
self on many occasions in the subsequent history of
Lloyd's, was, at this time, a comparatively young

EARLY DAYS 19

man. When only fourteen years of age, he had
entered the office of Mr. Andrew Thompson, a
constant attendant at the Coffee-house. By his
energy, intelh'gence, and high integrity, he had
raised himself to the position of a merchant and
underwriter on his own account. He possessed,,
in a large degree, those qualities which raise a man
above the crowd of his fellows, and his action in
connection with the domiciliation of Lloyd's, was
the first of many enterprising and spirited ac-
tions which raised him to a -position of eminence
in the Coffee-house, and earned for him a reputa-
tion and a name that deserves to be remembered.
Sixteen years after he had founded the " New
Lloyd's," he was appointed Chairman of the Com-
mittee, and continued to occupy that position
until 1796, when he was reluctantly compelled
to relinquish it for want of the necessary time
requisite for the due performance of the duties
connected with the office. The high esteem in
which " Julius " was held by his colleagues was
based not merely upon his personal excellencies,
but also his business qualities, which was strikingly
exemplified by the fact that, in course of time,
policies which bore his name as an underwriter,
came to be known by the name of "Julians," and
were prized accordingly by the brokers, as offering
the best security to their clients, for where Mr.
Angerstein was prepared to lead the best men in
Lloyd's were willing to follow. It is no exaggera-
tion, therefore, to say that in promoting the growth
and power of Lloyd's, he was largely instrumental

20 LLOYD'S YESTERDAY AND TO-DAY

As he himself said in his evidence before the
Parliamentary Committee in i8io, he had been
engaged in insurance business, as a broker and
underwriter, for not less than fifty-four years — he
was then seventy-five years of age, and was known
as the Father of Lloyd's — and had "found Lloyd's
a small institution, and seen it grow into vast
size."

Some idea of the growth of Lloyd's may be
gathered from the fact that in 1771 there were
seventy-nine subscribers only, and in 1891 there
were about seven hundred members — of whom five
hundred and eighty were underwriting members —
five hundred subscribers, and five hundred " sub-
stitutes."

CHAPTER II.
RISE OF LLOYD'S.

SIMULTANEOUSLY with the migration of
Lloyd's to their new premises in the Royal
Exchange, was reaHsed the desirabiUty of estab-
hshing some sort of governing body to control the
affairs of the institution, and protect the interests
of its frequenters. Hitherto, Lloyd's Coffee-house
had been open to all who cared to go there, and
even when it became the almost exclusive rendez-
vous of merchants and underwriters, they still as-
sembled at will, and knew no rules or regulations
to direct their transactions either individually or
collectively. It was this freedom which drew to
Lloyd's all sorts of adventurous spirits, who pre-
ferred any sort of speculation to legitimate busi-
ness, and who afterwards brought upon Lloyd's
an unenviable notoriety as an assembly of game-
sters. A writer in the London Chronicle in 1768
points to the " amazing progress of illicit gaming
at Lloyd's Coffee-house, ae a very melancholy
proof of the degeneracy of the times." It would
appear that Mr. John Wilkes was a particularly
favourite excuse for a " flutter " among these un-
principled gamblers. His chance of being elected
member for London was estimated variously at

LLOYD'S YESTERDAY AND TO-DAY

from five to fifty guineas per cent. ; while his
chance for Middlesex was insurable from twenty to
seventy guineas. His life for one year was insur-
able at five per cent., with the warranty that he
should remain in prison during that period. Ac-
cording to the writer, Scotchmen were the chief
sinners in this system of wagering, which shows
up the Highlander in a different light from that
in which we are nowadays accustomed to regard
him. Men's lives, however, were not the only sub-
ject of what another writer of the period called
" such detestable gaming." Many of the specu-
lators embarked upon the treacherous seas of
foreign politics, and wagered on the prospects of
Continental war. Frequent opportunities were
thereby afforded unscrupulous persons of defraud-
ing their neighbours, through the chance possession
of some piece of important information ; and if the
writer above quoted is to be relied upon, these
opportunities were not entirely neglected by per-
sons who certainly ought to have known better.
" It is a well-known fact," he says, " that a certain
ambassador insured ;^30,ooo on Minorca in the
war of 1755, with advices at the same time in his
pocket that it was taken." This was what we
should call nowadays a concealment of material
fact.

The frequency of such transactions at the
Coffee-house no doubt led to the re-formation,
though I fear not the reformation, of Lloyd's, in
spite of rules and regulations, and the exaction
of a subscription of ^^"20 per annum, payable in

RISE OF LLOYD'S

advance, to keep out undesirable persons. Still,
the intention was good, for, at the very first meet-
ing of the subscribers in their new premises at
the Royal Exchange, held in March, 1774, these
" shameful practices " were discussed in serious
earnest. Ultimately a resolution was unanimously
passed, embodying the hope that, whereas " in the
first instance it is endangering the Lives of Per-
sons so Insured from the idea of being selected
by society for that inhuman purpose, which is
being virtually an accessory in a species of slow
murder," and so on, " Insurers in general will
refuse subscribing such Policies, and that they will
show a proper Resentment against any Policy
Broker who shall hereafter tender such a Policy to
them." The resolution did not specify the methods
whereby underwriters should display a " proper re-
sentment," whether by physical force or otherwise,
but left it to the discretion of the individual.

Superstition and the love of hazard have ever
been characteristic not only of "those who go
down to the sea in ships," but those who have any-
thing to do with matters seafaring. One would
think that there was enough stake entrusted by
underwriters with the goddess of chance without
their adding to it in the manner described above,
but there always have been, and always will be,
some among them who think otherwise. The
resolution passed in 1774 has been come to again
and again since that day, in varied forms, and
language less quaint, perhaps, but the day is not
yet when a wager policy is shown at Lloyd's as a

24 LLOYD'S YESTERDAY AND TO-DAY

thing extinct. The mighty aid of the law has
even been invoked to declare that a policy
bearing the words "policy proof of interest," or
" without benefit of salvage," etc., is void, and can-
not be enforced as a legal contract in a court of
justice ; but these transactions are guided and
guarded by a code which is said to be recognised
by much less reputable persons than underwriters.
Of the earlier years of the century, an interesting
relic is still preserved at Lloyd's. This is none
other than an original policy effected upon the life
of the first Napoleon. It was for one month at a
premium of three guineas per cent. ; and the
following is a copy of the document, which hangs
in the Secretary's office — where also an autograph
letter of Wellington, addressed to Lloyd's in his
capacity as Warden of the Cinque Ports, is also
preserved and exhibited : —

In consideration of three guineas for one hundred pounds,
and according to that rate for every greater or less sum
received of WiUiam Dorrington, we who have hereunto
subscribed our names do for ourselves, and our respective
heirs, executors, administrators, and assigns, and not one
for the other or others of us ; or for the heirs, executors,
administrators, and assigns of the other or others of us,
assume engage, and promise that we respectively, or our
several and respective heirs, executors, administrators, and
assigns, shall and will pay, or cause to be paid, unto the said
William Dorrington the sum and sums of money which we
have hereunto respectively subscribed without any abate-
ment whatever.

In case Napoleon Bonaparte shall cease to exist, or be
taken prisoner on or before the 21st day of June, 1813,
commencing from this day.

London, 2ist May, 1813.

PN;^

AX UNDERWRITER.

RISE OF LLOYD'S 25

;^ioo. R. Heath. One hundred pounds.

2ist May, 1813.

£iSo- Anthony Finn Kemp. One hundred and fifty
pounds. 2 1 St May, 18 13.

^^150. B. I. Mitchell per Anthony Finn Kemp.
One hundred and fifty pounds. 21st May, 1813.

So runs this interesting document. The life of
Alphonso XII. of Spain was insured there, as was
also, more recently, the Duke of Westminster's
race-horse Ormonde. During the London Dock
Strike a very large business was done in insurance
against the risks of riot and civil commotion ; and
insurances against fire and burglary are constantly
effected. Looking at the matter impartially, it,
therefore, cannot be said that the description of
Lloyd's, in a recent French paper, as a " veritable
insurance bazaar," was altogether wide of the
mark.

Bank deposits are frequently insured at Lloyd's,
and even the Baring Guarantee in 1891 was very
largely covered in the room at a premium of ten
guineas per cent. An astute Russian grain-ex-
porting house the same year took out an insurance
— not with Lloyd's this time, but with one of the
leading English companies — to protect himself to
the extent of ^5,000 in the event of an Imperial
prohibition being issued against the export of
grain during the year. As every one knows, the
contingency which this 'cute Russian foresaw,
happened, and the company booked a total loss
that had not been brought about by perils of the
sea.

26 LLOYD'S YESTERDAY AND TO-DAY

Orme, the celebrated racehorse, was insured
at Lloyd's against being scratched out of the
Derby of 1892, and ultimately as much as 75
guineas per cent, was paid for reinsurances on this
risk, before the horse was finally withdrawn by his
owner. This, however, is a special risk, consisting
almost entirely of the speculative element, and
instances of equally extraordinary insurances
might be multiplied indefinitely. But the insur-
ance of their wives against twins, by husbands in
comparatively straitened circumstances, is now
quite a common transaction, and recognised in the
Room as a praiseworthy act of prudence. This,
however, is digressing ; but it is well to bear in
mind in, descanting upon these speculative insur-
ances, that they had, in a way, a great deal to do
with the original foundation of Lloyd's on a busi-
nesslike basis, which led the way to its subsequent
greatness.

Of all the services which Lloyd's has rendered
to the world at large, the encouragement and help
that was extended to Henry Greathead, the
originator of the lifeboat, may be accounted
among the most praiseworthy. The service of
lifeboats, which extends along our whole coast-
line, and by which hundreds of lives are annually
saved from the perils of the sea, might not have
been an accomplished fact to-day, but for the spirit
and generosity of Mr. James Forsyth and Mr.
Peter Warren, of Lloyd's. Greathead was a boat-
builder at Shields, whose attention had first been
directed to the idea of a " safety-boat," as he was

RISE OF LLOYD'S 27

inclined to call it, by being shipwrecked on the
coast of France. It happened in this wise. Great-
head had embarked as ship's carpenter on board a
vessel bound for the West Indies, but he had not
been long out of port before he observed several
suspicious circumstances, which led him to believe
that the ship was intended to be scuttled, with the
object of defrauding the underwriters. His fears
proved to be well grounded, for the captain,
baulked of his intention to run the vessel on the
Goodwin Sands, headed her for the French coast,
and put her ashore near Calais. No lives were
lost, and Greathead lost no time in communicating
his views to the underwriters at Lloyd's, in con-
sequence of which the claim was repudiated. For
this service Greathead earned for himself the
gratitude of Lloyd's, which, however, he was un-
able to turn to practical account for several years.
During this time the unfortunate ship's carpenter
suffered many privations and hardships, both on
land and sea, and it was not until 1784 — five years
after his shipwreck — that he was able to return to
his native country, and apply himself to carrying
into practical shape the idea which v^as uppermost
in his head. Poverty, however, proved a serious
obstacle to success, and here it was that Lloyd's
befriended him. When his plans were completed,
he submitted them to Mr. Warren— some time
partner with Mr. Angerstein — through whose
means he was introduced to the Duke of North-
umberland. The Duke was immediately interested
in the scheme, and furnished, together with the

28 LLOYD'S YESTERDAY AND TO-DAY

members of Lloyd's, the funds for the building of
the first lifeboat for the rescue of shipwrecked
persons. The maiden effort of this new craft —
appropriately named the Northumberland — was
successful in rescuing from the EdinbiirgJi the crew
of seven men, in a sea " so monstrous high that no
other boat could have lived in it." Mr. Angerstein
was here again to the fore, and on his initiative
;;^2,0CK) was subscribcd by Lloyd's for the en-
couragement of lifeboats ; and fourteen were built,
equipped, and stationed in various parts of the
kingdom. This was in 1802, and for the next
twenty-two years the whole lifeboat service of the
country was kept going by Lloyd's, until taken
over by the " National Lifeboat Institution,"
whose first president was the same Duke of
Northumberland.

The years which closed the eighteenth, and
opened the nineteenth, centuries are, perhaps, the
period upon which Lloyd's may look back with
the most justifiable pride and gratification. Those
were stirring times ; but wars, and rumours of wars,
served to show what patriotism Englishmen were
capable of, and Lloyd's men were not found want-
ing. The honour and glory of fighting fell not to
their lot, but their patriotism found outlet none
the less noble. Two months after war had been
declared against France, in May, 1803, the idea of
establishing a Patriotic Fund, which was originated
by Mr. Angerstein and Sir Francis Baring, M.P.,
was put into practical effect. On the 20th July a
general meeting of the members of Lloyd's was

RISE OF LLOYD'S 29

held, Alderman Sir Brook Watson, the then chair-
man, presiding. At this crowded gathering Sir
Francis Baring and Mr. Angerstein both spoke,
and urged the desirability of encouraging in every-
way their fellow-subjects who were engaged, or in
any way instrumental, in saving this country from
the " yoke of Gallic despotism " which threatened
to be laid upon the whole of Europe. Their
sentiments found a cordial echo in the hearts of
their hearers, and, after some further discussion,
the establishment of a Patriotic Fund was decided
upon without a single dissentient voice. The
resolutions arrived at were seven in number, one
of which set forth that " to animate the efforts of
our defenders by sea and by land, it is expedient
to raise, by the patriotism of the community at
large, a suitable fund for their comfort and relief,
for the purpose of assuaging the anguish of their
wounds, or palliating, in some degree, the more
weighty misfortune of the loss of limbs ; of alle-
viating the distresses of the widow and orphan ;
of smoothing the brow of sorrow for the fall of
dearest relatives, the props of unhappy indigence
or helpless age ; and of granting pecuniary rewards,
or honourable badges of distinction, for successful
exertions of valour or merit" And it was also
decided that " all sums, however small, which shall
be offered by the patriotism of the poorer classes
of our fellow-subjects, shall be accepted, the cause
affecting equally the liberties and lives of persons
of every description."

It will be gathered from this that the appre-

30 LLOYD'S YESTERDAY AND TO-DAY

hensions of foreign invasion were real and wide-
spread, and indeed the language of the appeal to
the public at large issued from Lloyd's amply
testifies to this. The document is worth quoting
in extenso : " The merchants, underwriters, and
other subscribers to this House, having this day
met for the purpose of setting on foot a general
subscription, on an extended scale, for the en-
couragement and relief of those who may be
engaged in the defence of the country, and who
may suffer in the common cause, and of those
who signalise themselves during the present most
important contest ; and feeling confident that, when
our very existence as a great and independent
nation is at stake, it only becomes necessary to
point out any means by which the exertion of our
native spirit, and the application of our powerful
resources, may receive an additional stimulus, they
beg leave to submit to the liberal consideration
of their fellow-subjects the following resolutions,
which have been unanimously passed at this meet-
ing, and presume to hope that the object of this
subscription will be so promoted and sanctioned
by public bodies in general, by the higher ranks
and opulent classes of society, and by individuals
of every description, that the mite of the labourer,
combining with the munificent donation of the
noble and wealthy, shall be the best pledge of our
unanimity ; shall inspire our seamen, our soldiers
and our countrymen at large, with a well-grounded
confidence in the liberality and gratitude of the
community ; and shall impress on the minds of

RISE OF LLOYD'S 31

our enemies the strong conviction that the energies
of this great empire are as irresistible as its re-
sources are incalculable."

Lloyd's launched this appeal upon the country
by appropriating from the funded property of the
society no less a sum than ;^20,ooo, " to set an
example," as the resolution proudly worded it, " to
the public bodies throughout the United Kingdom,
and its dependencies, and to our fellow-subjects of
every class and denomination." The example was
nobly followed by all, with the exception, curiously
enough, of "the higher ranks and opulent classes,"
of whom might reasonably have been expected the
most. " The mite of the labourer " was there with
a vengeance, " but the munificent donation of the
noble" did not appear. In spite of this, upwards
of ;^20,ooo was subscribed within a few days, the
scheme being received with the greatest favour
throughout the length and breadth of the country.
During the first six years after the opening of the
fund, ;^424,832 was received by the committee of
management, and even the humblest ranks were
represented among the contributors. Servant-girls
and schoolboys, labourers and watermen, sent their
pence, and shillings — ay, and even pounds, thus
justifying the proud boast made by Lloyd's that
"we are ready to drain both our purses and our
veins in [any] great cause which imperiously
calls on us to unite the duties of loyalty and pa-
triotism with the strongest efforts of zealous exer-
tion."

The Peace of Paris brought the war to a close,

32 LLOYD'S YESTERDAY AND TO-DAY

and with the cessation of hostilities ceased also the
raison d'etre of the Patriotic Fund. The accounts,
however, were not finally made up until 1826,
when it was found that nearly ^^630,000 had been
received in all, Lloyd's heading the list with the
splendid figure of ;^20,ooo, not reckoning the
private contributions of individual members of the
society. The Bank of England and the East India
Company followed next with i^5,ooo each, and the
Insurance Companies also subscribed handsomely.
One result of the establishment of the fund was
that, from a position of comparative obscurity,
Lloyd's rose, at a bound, to an eminence of fame
and popularity far beyond the limits of com-
mercial life, and laid a landmark in its history
which its members, present and to come, will
always look back upon with a pride that is only
exceeded by its justification.

The following is a copy of a certificate awarding
a grant from the Patriotic Fund : —

Patriotic Fund,

Lloyd's, Dec. 3rd, 1805.
Sir,

I am directed by the Committee to inform you that, at a
general meeting held this day, they voted you the sum of ^20,
in consideration of the wounds you received in contributing
to the signal victory obtained by the British Fleet, consisting
of twenty-seven Sail of the Line, under the command of the
ever-to-be-honoured, and lamented, the late Vice-Admiral
Lord Viscount Nelson, over the combined fleets of France
and Spain, consisting of thirty-five Sail of the Line, off Cape
Trafalgar, on the 21st day of October last, when nineteen
Sail of the Line were captured and taken from the enemy,
and, in the noble words of Vice-Admiral Lord Collingwood,

RICHARD THORNTON.
From an Etching by R. Dightoji, 1818.

RISE OF LLOYD'S 33

who so nobly completed the triumph of the day, " Every
individual appeared a hero on whom the glory of his country
depended."

I am, Sir,

Your obedient servant,

James Shaw,

Mayor.
Mr. Robert Carthy,

Marine.
H.M.S. Belleisle.

The possession of a Patriotic Fund medal was
eagerly sought after, as that of the Victoria Cross
of our day, and, when obtained, was prized by its
recipient as a well-nigh priceless treasure.

The Patriotic Fund was revived again in 1855,
during the Crimean War, when Mr. R. Thornton,
the celebrated City millionaire, commonly known
as " Dicky Thornton," was at the acme of his
commercial greatness. Those were days of big
premiums, when underwriters had a good chance
of making fortunes in legitimate business ; but
'"Dicky" liked to engage in all sorts of risky
" specs," and was known to be enormously wealthy.
It is related of him that he had a standing bet
with a fellow-underwriter at Lloyd's, that for every
child the Queen bore he was to pay i^ 1,000; but
should her Majesty give birth to twins " Dicky "
was to receive iJ"20,ooo. That was one of his
unlucky ventures, as it turned out. When the
Patriotic Fund was reopened he was one of the
first invited to subscribe, but, in his blunt way, re-
fused to give a cent. Subscriptions, however, were
received in sums of fifty guineas downwards, till a
fairly respectable amount was collected, when Mr.

C

34 LLOYD'S YESTERDAY AND TO-DAY

Thornton was again approached. By this time he
had come to view the matter in a more favourable
light, and, taking the pen between his trembling
fingers, wrote his signature for two hundred and
fifty guineas. "There," said he, as he threw down
the quill — "good for three millions!" And he
was, too.

By the way, a curious feature in connection with
the personnel of Lloyd's is the heredity which
seems to have obtained through many generations.
As already stated, the institution attained con-
siderable distinction and popularity in consequence
of the inauguration and management of the
Patriotic Fund, and was much " lionised " accord-
ingly— if such an expression can be applied to a
society. Many newspapers and magazines of the
period devoted articles descriptive of the doings in
the " Room " ; and many names, which might
otherwise have been forgotten, have thus been
preserved from oblivion. In the following doggerel,
which was published about 1805, and was entitled
" A Literal, Critical, and Poetical Transcript from
Lloyd's," it is interesting to find a great number
of the names of men who are to-day frequenters
of the " Room " :—

A Black and a Whiie, with a Brown and a Green,
And also a Grey at Lloyd's room may be seen ;
With Parson and Clark, then a Bishop and Pryor,
And Waters — how strange ! adding fuel to fire —
While at the same time, 'twill sure pass belief.
There's a Winter, a Garla?id, Furse, Budd, and a Leaf;
With Freshfield, and Greenhil/, Lovegrove, and a Dale ;
Though there's never a breeze, there's always a Gale.

RISE OF LLOYD'S 35

No music is there, though a Whistler and Harper;

There's a Blunt and a Sharp, many flats, but no sharper^

There's a Daniel I, a Samuel, a Sa?npson, an A bell —

The first and the last write at the same table.

Then there's Virttie and Faith there, with IVylie and Rasch,

Disagreeing elsewhere, yet at Lloyd's never clash.

There's a Long and a Short, Small, Little, and Fatt,

With one Robert Dewar, who ne'er wears his hat.

No drinking goes on, though there's Porter and Sack.

Lots of Scotchmen there are beginning with Mac :

McDonald to wit, Mcintosh and McGhie,

McFarquhar, McKenzie, McAndrew, McKhie—

An evangelised Jew, too, and infidel Quaker.

Then there's a Bunn and a Pye, with a Cook and a Baker.

Though no tradesmen or shopmen are found, yet herewith.

Come a Taylor, a Sadler, a Paynter, a Stnyth ;

Also Butler and Chapma?i, with Baker and Glover

Come up to Lloyd's room their bad risks to cover.

Fox, Shepherd, Hart, Buck likewise come every day ;

And though many an ass, there's only one Bray.

There's a Mill and Miller, A-dam and a Poole,

A Constable, Sheriff, a Law and a Rule.

There's a Newman, a Niemann, a Redman, a Pitman,

But to rhyme with the last there is no other fit man.

These, with Youtig, Cheap and Lent, Luckie, Hastie and

Slow.
With dear Mr. All nut, Allfrey, and Auldjo,
Are all the queer names that at Lloyd's I can show.

The line concerning Robert Dewar and his hat is
worthy of note as illustrating the prevalence of a
custom which obtains to this day — though not so
rigorously conformed to — of never doffing the hat.
In those days it was not considered "the thing"
for any but the waiters to remove their head-
coverings, and any member seen bareheaded was
liable to be accosted as " Waiter ! waiter ! " To
this custom may perhaps be ascribed the fact that

36 LLOYD'S YESTERDAY AND TO-DAY

most of the members of Lloyd's over forty years
of age are decidedly " thin on the top," if not
absolutely bald.

Just as the eighteenth century was drawing to a
close, occurred another event which must always
figure prominently in the history of Lloyd's, and
which could supply ample material for the weaving
of romance by some Robert Louis Stevenson.
The accounts of the wreck of the Lutine have been
almost as various as they have been numerous, but
the facts may be briefly told. The Lntiite, a
thirty-two gun frigate originally christened by the
French ^' La Lntine," but subsequently captured
from them by the British, was engaged in October,
1799, to transport treasure to the value of upwards
of a million sterling to Hamburg. The treasure
was not for the payment of British troops abroad,
as has been stated, but was the property of a
number of London merchants, who were engaging
in a purely commercial speculation. How a
Government vessel came to be engaged in a
private commercial enterprise is not quite clear,
but the fact remains. Eighteen hours after leaving
Yarmouth Roads, the vessel drove ashore, far out
of her course, on the shoals of the Zuyder Zee.
The report of the loss was received by the
Admiralty on October 19, but Lloyd's was four
days ahead with the receipt of the news. Of the
two hundred persons aboard at the time of the
wreck only one was saved, and he succumbed
before reaching England. The underwriters at
Lloyd's promptly settled a total loss on their

FUSE OF LLOYD'S 2,7

policies, though many of them must have been
severely crippled, if not ruined, by this calamitous
loss. Steps were immediately taken to recover
some of the sunken treasure ; but, unfortunately,
England was then at war with the Netherlands,
whose Government claimed the wreck as their
spoil. While the war continued, the Dutch fisher-
men made the most of their opportunity of salving
the specie, and some ^^56,000 was recovered, two-
thirds of that amount being appropriated by the
Government of the Netherlands. Salvage opera-
tions were carried on, at various times, for the next
sixty years, upwards of ^^40,000 being recovered in
the period between 1857 and 1861 alone. Of this
sum, Lloyd's were entitled to one-half, under con-
tract with a company of Dutch salvors, headed by
Pierre Eschauzier, and sanctioned by the King of
the Netherlands. But here arose a problem.
During the sixty years that had elapsed since the
wreck, the underwriters interested had all died, the
policies had disappeared, and the very building in
which the risks had been written had been reduced
to ashes by the fire of 1838. So a special Act of
Parliament was passed, allowing the Corporation
of Lloyd's to take possession of the money, and
settle any claims that might arise.

Since then no further operations have been
undertaken, but it is estimated that upwards of
a million still remains embedded in the sand, or
rotting hulk of the old frigate, and some day a
treasure-seeking expedition may be formed. Any-
how, there is no chance of Lloyd's ever forgetting

3S LLOYD'S YESTERDAY AND TO-DAY

the story, as every visitor to the committee- room
must be struck on entering with the massive old-
fashioned chair and table, made out of the rudder,
and the bell and chain of the ill-fated vessel. The
rudder was recovered from the wreck in 1859,
having been in the water sixty years, and the chair
and table are suitably inscribed with a brief story
of the disaster.

Another interesting memento of this famous
wreck is preserved in the Guildhall, at the entrance
to the museum, in the shape of a cannon which
formed part of the Ltitincs armament. The gun
was recovered from the wreck in 1886, having
been immersed for nearly a century, and was pre-
sented by the Corporation of Lloyds' to the City of
London in 1888. It is mounted on a wooden
carriage, which bears a tablet with a suitable in-
scription.

CHAPTER III.
TO-DAY.

THE establishment of a regular organized com-
munity for the conduct of marine business
rendered it also desirable to adopt some definite
form of marine policy, instead of the many varie-
ties which had been in use ; and so, in 1779, the
printed form of policy, which is still in regular and
general use, was drawn up at a fully attended
general meeting of the members. The only change
in the wording of this document — which Mr. Jus-
tice Buller once described as "absurd and inco-
herent, and Lord Mansfield as " a very strange
instrument" — was made in 1850, when the pious
preamble of " In the Name of God, Amen," was
abolished, and the formal " Be it known that "
substituted. This is the only alteration that has
been made in this document, drawn up more than
a century ago ; and, though it may justly be
stigmatised as " hardly intelligible " to a layman,
yet it has the merit of having had almost every
clause explained by many legal decisions. Another
thing worth noting is the clause towards the end
of the document, to the effect that " This Writing,
or Policy of Assurance, shall be of as much force
and Effect as the surest Writing, or Policy of As-
surance, heretofore made in Lombard-street, or in

39

40 LLOYD'S YESTERDAY AND TO-DAY

the Royal Exchange, or elsewhere in London."
At the time this form was drafted, the connection
between Lloyd's and Lombard Street had long been
severed, but the memory is thereby still preserved.
The origin of the word policy is somewhat doubt-
ful, but a well-known average adjuster derives it
from the Latin word " Pollice," the ablative of
" Pollex," and says it originally meant " with the
thumb." In the olden days underwriters were not
so expert with their pens as they are to-day, and
they impressed their mark to the policy with
their thumb, instead of affixing their signature.
Whatever its derivative origin may be, it is a
" promise " on the part of the underwriters, in con-
sideration of a premium received, to undertake
certain specified risks. It may therefore be de-
scribed as a sort of Promissory Note. The
" promise " of the underwriters is given to the person
or persons named in the policy, or to his or their
order. The name of some person must always be
inserted — policies in blank are void in law. It is
given, whether the thing insured is at the time
" lost or not lost," and relates to a subject matter
which must be defined. This must be at risk in or
with a ship, and on a voyage clearly laid down in
the document, and the whole policy is a guarantee
against loss from certain perils duly specified
therein. The written part of a policy overrides
the printed part, when there is any difference be-
tween them. The policy is the only legal evidence
of the terms of the contract of Marine Insurance.
It must be correctly stamped, according to the

TO-DA Y 41

Stamp Act, and dated. An unstamped policy is
void in law ; and this applies to all Policies in
England, whether efifected here or abroad.

The immigration to the Royal Exchange had
been necessitated by the increase of the number
of frequenters of the Coffee-house, and with its
numbers grew its strength and importance. Suc-
cess was writ large over the portals of the institu-
tion, and active competition could not be long in
coming. Nor was it. Half a century earlier, the
monopoly of carrying on marine insurance busi-
ness by Joint Stock Companies had been granted
by Act of Parliament to the Royal Exchange and
London Assurance Corporations ; but these two
companies, instead of injuring Lloyd's, in reality
did just the reverse. The charter of George I.,
intended originally to protect the two Corpora-
tions, also protected Lloyd's from anything like
serious competition. During the last fifty years
of the eighteenth century the volume of marine
insurance business had grown to an extraordinary
size, and the two Corporations being unable to
handle more than a mere fraction of it, the bulk
went to the Room, the proportion being perhaps
nineteen-twentieths to Lloyd's, and the remaining
one-twentieth between the Royal Exchange and
London Assurance Corporations. The Parliamen-
tary Commission of 18 10 elicited the information
that of a total of ^656,000 insured on the Diana
frigate, on a voyage from Vera Cruz homewards,
no less than ^^"63 1,800 was underwritten at Lloyd's,
the remaining ;^24,ooo being divided by the two

42 LLOYD'S YESTERDAY AND TO-DAY

Corporations. It was during that forty years of
storm and strife which began in 1775 with the
American War of Independence, and ended with
the Peace of Paris in 1815, that Lloyd's rose to
an eminence which was utterly undreamt of by
its early patrons. The wars which were carried
on almost without cessation during that period,
compelled merchants to pay very high premiums
for the insurance of their floating property, for,
to the ordinary risks and perils of the sea, were
added the dangers of " Surprisals, Takings at Sea,
Arrests, Restraints, and Detainments of Kings,"
etc., which were real indeed. During the year
1782, when all the naval powers of Europe were
in arms against Great Britain, the following pre-
miums among others are stated in Anderson's
" Historical and Chronological Deduction of the
Origin of Commerce " as being currently quoted : —

London to the West Indies, with convoy, 10 per

cent., or 20 to return 10.
London to Jamaica, with convoy, 12 per cent,

or 20 to return 8.
London to New York and Halifax, with convoy,

15 guineas per cent, or 25 to return 10, if

ships of force ; without convoy, if ships of

force, 25 to return 8.
London to Cork, Waterford and Dublin, 6 guineas

per cent.
Ireland to Portugal, 15 to 20 per cent, to return

5 to 10 if with convoy ; to the Mediterranean

an advance of 3 per cent

TO-DA V 43

Jamaica to Great Britain or Ireland, 25 per cent,
to return 8 if without convoy, or 16 per
cent, warranted with convoy.

Liverpool, Bristol and Glasgow to New York,
25 to 30 per cent, to return 16 for convoy.

The security of Lloyd's was undoubted, and the
war had the effect of driving business into this
country from all parts of the world, and lines of
i^i.OOO a name were subscribed by underwriters
as readily as ;^ioo to-day. On the Diana, before
referred to, Mr. Thomas King wrote ;^io,ooo,
v/hile several others took lines of ^5,000, i^3,ooo,
and so on. It is easy to see, therefore, that for-
tunes were in many cases rapidly built up, and
the prosperity of individuals became the wealth of
the Coffee-house as a body.

This was the condition of things that obtained
when the directors of the Globe Fire and Life
Insurance Company applied to Parliament, in
1798, for a repeal of the Act of George I. as far as
it prevented other Companies from carrying on
marine insurance business. The application was
not successful, but it led to a Parliamentary inquiry
into marine insurance generally. During this
inquiry Lloyd's came in for some pretty rough
handling at the instigation of those who looked
with envy upon the success of the institution, but
it ultimately emerged from the ordeal, as the
newspapers of to-day would say, " without a stain
upon its character." And for another period — until
1824 — Lloyd's and the two chartered Corporations

44 LLOYD'S YESTERDAY AND TO-DAY

had the whole marine insurance business in their
own hand's. The inquiry, however, had had this
good result, that it exposed the looseness of the
system of Government that obtained at Lloyd's ;
and public attention having been directed towards
this weakness, Lloyd's, for its own sake, could
not long allow the defect to remain unremedied.
Moreover, now that freedom from external agita-
tion had once more been obtained, the members
of the Coffee-house had leisure to look at home.
And so it happened that in March, 1811, a com-
mittee of twenty-one members was appointed " to
consider of such measures as may be necessary
for the future good management of the affairs of
this House."

For the preceding forty years or thereabouts
the affairs of Lloyd's had been directed by a
" House Committee," composed of from twelve
to twenty members appointed for life ; but they,
in their turn, seem to have been controlled by the
general body of members assembled at general
meetings. Again, a large amount of detail work
appears to have been within the province of the
" masters," the term originally applied to the
proprietors of coffee-houses. Of course, when the
migration took place to the Royal Exchange,
Edward Lloyd had long been dead ; but the society
still preserved his name, together with the titles of
" master " and "waiter." The latter remains to this
day, but the former ceased to exist in compara-
tively recent times. The duties of the waiters were
what we understand them to be to-day ; but the

A WAITER.

TO-DA V 45

functions of the " master " at Lloyd's — generally-
appointed from the ranks of the waiters — were
something more than directing his subordinates,
as he participated in the profits of the Room, had
to pay the rent and taxes, and supply stationery,
newspapers, etc.

The minutes of Lloyd's record that at the very
last meeting of subscribers held in Pope's Head
Alley, it was resolved to appoint, as master of
the new rooms in the Royal Exchange, Thomas
Tayler, the then head-waiter, and that he should
" reap one fourth part of the net profits of the
House," It was also resolved at the same meeting
that Tayler and his head-waiter, one Thomas
Fielding, should participate in certain fees and
" become tenants at will to the subscribers to New
Lloyd's Coffee-house, paying them the " annual
rent of one hundred and eighty pounds." This,
however, was a very anomalous state of things,
and one which one of Her Majesty's Secretaries
of State was the indirect cause of being remedied
to a certain extent. At the beginning of this
century it seems to have been part of the master's
duty to carry on the correspondence of the House,
for, in 1804, Lloyd's was in communication with
the Government on the subject of convoys and
other matters affecting the business of the under-
writers in consequence of the war that was then in
progress. A few letters were interchanged, those
from Lloyd's being signed as usual by the master,
but the correspondence was brought to an abrupt
conclusion by the curt intimation of Earl Camden,

46 LLOYD'S YESTERDAY AND TO-DAY

the Secretary of State for the Colonies and
War Department, that he was unable to continue
a correspondence with the " waiters at Lloyd's
Coffee-house." This decided snub immediately
resulted in the appointment of a secretary to con-
duct the correspondence of the House.

At the hands of the Committee appointed in
1811, the Government of Lloyd's underwent a
thorough reorganisation, the whole of their recom-
mendations being adopted. One of them was that
agents should be appointed, to act for the benefit
of underwriters in general, in place of the system
then in vogue, of individual underwriters appoint-
ing another to act for them by power of attorney.
Tins Committee also for the first time expressly
laid down what class of persons were eligible as
subscribers to Lloyd's ; what forms should be gone
through prior to election, and many other very ex-
cellent rules and regulations, many of which guide
the conduct of Lloyd's to this day. Amongst
other things, a suggestion had been made by Mr.
Joseph Marryat, that a Board ought to be estab-
lished for the purpose of settling averages. In
those days the profession of " average adjuster "
did not exist, it being customary for the broker
to " state " the averages which he desired, on be-
half of his clients, to collect from the underwriters.
The Committee thus reported on the proposi-
tion : — " The great difficulty in settling averages
appears to your Committee to arise either from a
want of skill or industry in the broker to state, or
in the underwriter to examine them, for the prin-

TO-DA V 47

ciples upon which they are to be made up have
been so completely settled in most cases by legal
decisions, that disputes seldom happen between
men who have given proper application to the
subject. It might certainly contribute very much
to the ease and convenience of many individuals
to refer all complex statements and voluminous
papers to a Board of Average ; but it is the duty
of every broker and underwriter to qualify himself
for the avocation he undertakes, and your Com-
mittee are persuaded that in this, as in every other
case, the underwriters would find a material dif-
ference between superintending their interests
themselves as they now do, and leaving them to
the superintendence of others. Your Committee
consider the present system of making up state-
ments by the broker on the part of the assured,
and examining those statements by the under-
writers as being well calculated both to prevent
delay and to promote the ends of justice ; and they
find so many objections to the difficulties in the
formation of a Board of Average that they cannot
recommend such a plan to the adoption of the
subscribers."

Another movement in the same direction, some
fifteen years later, met with no better success,
and as average adjusting as a separate and
recognised profession came more and more into
vogue, the need for the agitation disappeared.
In later years a development of the same idea has
shown itself in the suggestion of an Examiner
of Claims being established at Lloyd's, to look

48 LLOYD'S YESTERDAY AND TO-DAY

into the statements of the average adjusters on
behalf of the underwriters generally, and report
thereon for the common benefit. The idea was
mooted in 1868, and a general meeting was held
in April, 1874, to consider the subject. Once
more, however, Lloyd's decided in the negative, and
the same attitude is preserved by the Committee
of Lloyd's to-day. The only point connected with
claims that has been dealt with recently, is that
of the payment of them. At a meeting of the
members held in 1870, it was resolved that on and
after the 1st July, 1870, the payment of losses
should be made one week after settlement, instead
of a month, as was previously the case, thus
assimilating the practice at Lloyd's with that
adopted by the Companies.

The year 1824 witnessed the repeal of the Act
of George I., and opened out the field of com-
petition in marine insurance business to whom-
soever cared to enter it. The first to take
advantage of it was the Alliance Company, founded
by Nathan Rothschild, at whose instigation the
repeal Act had been passed, and the Indemnity
quickly followed. With the latter will ever be
associated the name of Mr. William Ellis, who
occupied its underwriting chair for half a century,
and established a reputation for himself which
has never been approached in the history of
marine insurance. The story of the establishment
of the many marine insurance companies, which
have been founded since then, would fill a book
in itself. Suffice it to say, that by far the larger

AN INTERESTING DISCUSSION.

TO-DA V 49

proportion of those established have long since
ceased to exist, and the fear so earnestly expressed
at Lloyd's that indiscriminate competition would
bring about the ruin of the coffee-house has
never been near to realisation, and, if history is
a safe index to the future, never will be. Still,
underwriters have suffered somewhat severely, of
late years, by the decrease of rates, in consequence
of the severity of competition. Many men date
this down-grade movement from, and attribute it
to, the opening of the Suez Canal. Certain it is
that the adoption of this new route revolutionised
our Eastern trade, and exercised a very wide
influence upon the fortunes of underwriting.

Mr. J. T. Danson, of Liverpool, in his pamphlet
on "The Underwriting of 1872," wrote: — "In
1859, began an era of speculation in marine insur-
ance, which is not yet closed ; and which, it were
well if those who are still liable to lose their
capital would look a little closer into the history of.
Many now are the sufferers, but few care to parade
such experience, and fewer still — though keenly
alive to effects — could say anything profitable of
the cause of their losses." After detailing the
Companies which were established and which
collapsed between 1859 and 1865, he goes on :
" The Companies now surviving were indebted
for much of their early growth to special cir-
cumstances not very likely to recur. The American
Civil War broke out in April, 1861 ; it soon had
the effect of transferring to this country the
greater part of the marine insurance in the foreign

D

so LLOYD'S YESTERDAY AND TO-DAY

trade, previously done in the United States. The
war ended in 1865 ; but the old confidence in
American underwriters was not immediately re-
stored. It was not till 1868 that the business
which had been driven by the war from its ordinary
channels began in any great measure to return to
them. Thus, the surviving Companies had the
advantage, for some years, of an enchanced
demand for marine insurance in this country."

There is much truth and sound wisdom in the
remarks of Mr. Danson, but the immediate pro-
vocative of the pamphlet was generally supposed
at the time to have been the formation of the
"Imperial" and "Standard" Marine Insurance
Companies in Liverpool, which Mr. Danson, as
underwriter of the Thames & Mersey Company,
looked upon with little favour. A reply to the
pamphlet was quickly forthcoming in the shape
of a frivolous skit in verse, which, if I remember
correctly, began thus : —

" Cheeky Danson, full of bile,
Swore he'd write a pamphlet ;
These cursed new insurance folk
He'd make 'em every man flit.

" How dare they poach on his preserves,
And steal away his treasure ?
His is the only Co. that gives
Imperial Standard measure."

The Standard Company still exists, but the
Imperial went the way of the majority some years
ago.

But if Lloyd's as a collective body of under-
writers suffered in material prosperity, Lloyd's as an

TO-DAY 51

Institution had a still higher pinnacle of greatness
to attain, the achievement of which brings us down
to recent times. The constitution of Lloyd's as
established in 181 1 had lasted for a considerable
period without any material changes ; but, as
with most other things, the time came when repairs
could be no longer delayed. Ever since 1824
there had been, in the minds of some of the mem-
bers, the idea of still further strengthening the posi-
tion of Lloyd's, though nothing of much moment
was accomplished. But, at a general meeting of
the members of Lloyd's held in 1870, it was de-
cided, after protracted debates, to apply to Parlia-
ment for an Act of Incorporation. " Lloyd's Bill "
met with considerable opposition, but ultimately in
May, 1 87 1, owing in no small measure to the un-
tiring efforts of Mr. B. C. Stephenson — who is now,
perhaps, better known as the author of " Dorothy "
than as the late secretary of Lloyd's — the charter
of incorporation was granted to Lloyd's, the
corporate objects being, briefly : (i) The carrying
on of the business of marine insurance by members
of the society ; (2) The protection of the interests
of members of the society in respect of shipping
and cargoes and freight ; and (3) The collection,
publication, and diffusion of intelligence and infor-
mation with respect to shipping. The carrying out
of the last named of these objects — always a
prominent feature of the " Coffee-house " — has of
late years reached a high standard of perfection.
The intelligence department comprises in the first
instance about 1,500 agents, who are stationed in

52 LLOYD'S YESTERDAY AND TO-DAY

every town and port of the globe frequented by-
vessels ; and it is the duty of these officials to give
prompt information of all arrivals, sailings, wrecks,
casualties, and other occurrences to headquarters
at the Royal Exchange. The selection of these
agents is entrusted to a special committee, and the
post of Lloyd's agent is eagerly sought after on
account of the social position and prestige which
the appointment confers.

The Committee of i8ii evidently comprised a
far-seeing body of men, for in its recommendations
on the subject of Agents it " presumed " that the
appointment, "independent of the emoluments that
may occasionally attend it, will, . . . render it
a desirable object to merchants in general, who
will readily undertake to furnish the Committee, in
return, with regular advices of the arrival and
sailing of vessels, and every other information in
which the interests of underwriters are concerned."
The duties of Lloyd's agents are by no means, how-
ever, confined to furnishing news to headquarters,
and are set forth at length in a " letter of instruc-
tion " with which every agent is supplied on his
appointment. It is the business of the agent to
offer the master of a vessel ashore, or in distress,
such assistance as the nature of the case may
require ; to see that his protest is properly drawn,
and to certify the truth of the statements contained
therein, when opportunity permits ; in case of a
wreck, to take charge of the ship's materials and
stores, as well as such cargo as may be saved, and
prevent the same from being wasted or pillaged ;

TO-DA Y 53

when vessels are repaired, to see that the repairs
done at the expense of the underwriters are confined
to the damages actually received on the voyage
insured, and do not extend to those that may have
been received on a former voyage, or defects
arising from age ; and generally, so to act on
behalf of the underwriters as they would if the
case were their own, bearing in mind that " under-
writers require such premiums as experience has
taught them to calculate will indemnify them for
the risk they take ; and that, as they are obliged to
make the good pay for the bad, it is the interest of
every honest merchant to protect them against im-
position." Considerable scope is afforded to an agent
for the exercise of his energy and ability in respect
of the condemnation of vessels at ports of distress.
As his " enumeration of duties " sets out, " Ships
and cargoes are sometimes condemned not so
much from real necessity, as because it is the
interest of the parties to abandon, and throw the
loss upon the underwriters. Frauds of this nature
may be prevented by due attention, and the
appointment of respectable persons to act upon
surveys, who will distinguish between accident
and design, or unseaworthiness arising from natural
decay, for which underwriters are not liable."
What was true in i8ir, when this "Letter of
Instruction " was drawn up, is true to-day, and
probably will be to the end of the chapter.

A great deal of mistaken conduct of masters in
distress arises out of the fact of insurance, while
his supposed duty to his owners often leads him

5+ LLOYD'S YESTERDAY AND TO-DAY

to act so as to try to secure the largest possible
sum to them at the expense of the underwriters.
All such conduct is essentially a fraud upon the
underwriters. The only motive which can properly
impel an honest master in all cases alike is the
simple direct desire to save and preserve the property
without the slightest reference to the insurance or
to the ownership.

But, after all, accidents and cases of emergency
happen only occasionally, while the ordinary news
of ships' comings and goings is at many ports
constantly happening. The preparation and trans-
mission of this, at many places, must take up a
considerable amount of time and attention, and it
is but bare justice to say that, in the majority of
cases, this work is most carefully and efficiently
performed.

The information thus obtained is sifted and
distributed for the benefit of subscribers, and the
world at large. A staff of clerks is employed day
and night to deal with the vast number of messages
that are received. On receipt of a telegram, it is
first translated (if necessary), and then given to a
clerk for several copies to be made. The English
marine insurance Companies, who pay the full
subscription of ^^400 a year to Lloyd's, have mes-
sengers with shipping news continually throughout
the day, and at the same time reports are constantly
being wired to other maritime centres in connection
with Lloyd's, such as Liverpool, Glasgow, or Ham-
burg. Another branch of this department, which
has been worked with great success, is the reporting

TO-DAY 55

of vessels as they pass the various signal-stations
established at important points along our coasts,
and at several places abroad, such as Gibraltar, St.
Helena, Malta, Perim, and Aden. A ship, to be
reported, has only to sail in close enough for her
signal letters to be made out, and the news is
immediately flashed along the wires to Lloyd's,
and there posted and distributed for the benefit
of all concerned. A small charge is made to ship-
owners for this information, but the system is very
extensively made use of

The Committee of Lloyd's also make a special
appeal to captains for particulars of the vessels
spoken on the voyage, and expect them, in case of
any wreck, or vessel in distress, or overdue, be-
coming known to them, to communicate the fact
to Lloyd's agents at the first port of call. The
Committee cannot, of course, compel them to do
this, but as their printed request states, " It will be
enough for them to suggest, in order to enlist the
warmest support of captains, how often the news
thus received may be the only means of conveying
to shipowners, and relatives of crews, the assurance
of a vessel's safety."

A small office on the ground floor in Threadneedle
Street is set apart for inquiries, which are answered
free of charge, and many an anxious relative of
some sailor in far-off seas wends her way thither,
to have her fears confirmed, or hopes revived.

Nor does the work of recording end here. An
elaborate system of indexing, first invented by Mr.
James Bischoff, and practised on his own account,

56 LLOYD'S YESTERDAY AND TO-DAY

is in vogue at Lloyd's, by which the whereabouts
of vessels in every part of the world can be quickly
ascertained. A number of huge volumes, alpha-
betically arranged, are placed in the Reading-
Room, and a staff of clerks is constantly employed
in entering up the records. The entries made in
these volumes are references to Lloyd's List of given
dates, by turning up the files of which, information
can always be readily traced. Every year a new
set of volumes is used, and the old ones are stored
away for reference, if required at any future time.

In addition to these books, a " Captain's Regis-
ter " is also kept. This is nothing less than a
biographical dictionary of the whole of the certifi-
cated commanders of the British mercantile marine,
numbering some 30,000. The information con-
tained in this register is furnished exclusively to
Lloyd's from the records of the office of the Regis-
trar-General of Shipping and Seamen, and is sup-
plied under the authority of the Board of Trade.
The information given, though most concisely ar-
ranged, gives each man's full mercantile history —
his age, the date and place of his birth, the port at
which he was examined, with the date of his ex-
amination ; the names of the ships in which he has
served, whether as master, or mate with a master's
certificate ; and whether those vessels have come
to grief under his care or not. This book of re-
cords, one would think, would be a sufficient de-
terrent against careless navigation on the part of
captains ; but underwriters even now are some-
times heard to exclaim that more stringent penalties

TO-DA Y SI

should be enforced for gross negligence when
some fine vessel, in which they are pecuniarily
interested, comes to destruction through reckless-
ness, or worse.

The completest biography of any captain, how-
ever, would be of little use without some particulars
of the ship he navigated, and for this purpose
" Lloyd's Register of British and Foreign Ship-
ping" is published annually, giving the fullest
details of every British vessel of one hundred tons
and upwards, and including many foreign-owned
ships as well. From the earliest days of the Coffee-
house the necessity of having some such record
seems to have been recognised by underwriters,
and accounts of such vessels as were likely to be
offered for insurance were kept by the early fre-
quenters of the place. These " Ships' Lists " were
in manuscript, the first printed register being pub-
lished about 1730. The date cannot be exactly
determined, as the earliest copies were all de-
stroyed by the great fire which, in 1838, laid the
old Royal Exchange in ashes, and consumed many
other valuable books and documents relating to
marine insurance. The oldest copy of a " Register
of Shipping" in the library at the office of "Lloyd's
Registry" — indeed, so far as can be ascertained, the
oldest copy of any book of the kind at present in
existence — bears the date of 1764-5-6, for which
period it was evidently current. Its charred edges
bear evidence of having passed through the flames.

The work of surveying and classifying the ves-
sels recorded in the " Register " is carried on under

58 LLOYD'S YESTERDAY AND TO-DAY

a committee specially appointed for the purpose,
which, though distinct from Lloyd's, may yet be
regarded as a sister association. To Mr. Thomas
Chapman belongs the greatest share of the credit
of establishing " Lloyd's Register," which, in 1834,
was remodelled with a new set of rules, the appoint-
ment of a number of surveyors, and so on ; so that
to-day the volume which is issued from White
Lion Court is the most complete and reliable
authority of the kind in existence.

The " Register " contains the names, classes, age,
owners, builders, dimensions, signal letters, and
many other useful particulars relating to vessels
classed by the society, and also includes, as far as
possible, names, dimensions, etc., of all other
merchant vessels of the world of one hundred tons
and upward, some of which, although not classed
by the society, are classed elsewhere. An appendix
is also issued containing a list of owners and ships
recorded in the " Register Book," with the names
and tonnages of their vessels ; details of the docks,
tidal harbours, quays, etc., at all ports in the world ;
a list of the telegraphic addresses of all firms con-
nected with shipping, and particulars of the war
vessels belonging to all nations. By referring to
this " Register," an underwriter can see at a glance
a vessel's condition, and its fitness for carrying any
particular cargo, or undertaking any particular
voyage. The term " A i," which has become a
familiar expression of common usage, owes its
origin to this publication — the letters signifying
the highest class for wooden vessels. The symbol

TO-DA V 59

for the highest class of iron vessels is " loo A i " ;
and the details given respecting construction,
ownership, etc., combined with the signs and sym-
bols allotted to each vessel, enable an underwriter
to estimate to a nicety the requisite premium for
any risk that may be submitted to him.

Of course, in such a business as is carried on at
Lloyd's, the volume containing the record of losses
as they occur, occupies a prominent place in the
thoughts of underwriters, as it does in the Room
itself This " Black Book " — a ponderous tome
bound in green leather — is the object towards
which most underwriters feel themselves magneti-
cally attracted on their entering the Room. Some-
thing like three thousand casualties are entered in
the Loss Book in the course of the year. On the
occasion of the memorable gale in 1881, no less
than one hundred and eight casualties were re-
corded on its pages in one day ; the number of
lives lost at sea in the one week amounting to six
hundred and seventy-three. The year 1890 was
undoubtedly the most disastrous season experi-
enced since 1872, not so much as regards the
number of vessels lost, but the value of those
who.se arrival in port was never chronicled was
unusually high. To a student of human nature
this Loss Book would afford ample opportunity for
the exercise of his hobby, in observing the de-
meanour of those who peruse its pages. By long
practice some underwriters in the Room have
schooled themselves to betray, by no movement of
their features, the fact that they are interested in

6o LLOYD'S YESTERDAY AND TO-DAY

any of the disasters there recorded. But not many
have obtained so complete a mastery over their
emotions, and a close observer might generally tell
who is " hit," and who escapes.

After digesting the contents of the Loss Book,
frequenters of the Room generally make their
way to the Telegram Room, technically known as
the " Chamber of Horrors." Here copies of tele-
grams reporting casualties from all parts of the
world are posted up, and an eager group is gene-
rally to be found scanning the news which means
so much to them. Most of the telegrams refer to
casualties not sufficiently important to be entered
in the Loss Book, and so they are posted here on
yellow flimsy, for all to read who care. Besides
casualties, reports from our coasts are posted on
brown-coloured paper, and foreign arrivals and
sailings on yellow tissue ; also committee notices,
and lists of candidates for election as members or
subscribers to Lloyd's. In the recess of one of the
windows may generally be observed one or two
notices on white paper. These refer to missing or
overdue vessels. The custom of " posting " vessels
that are overdue is a time-honoured formality at
Lloyd's. When a vessel is so much overdue as to
be regarded by her owners as hopeless, application
is made to the committee to have the vessel
" posted." If the committee consider such a pro-
ceeding would not be premature, a printed notice
is, on Wednesday, affixed to the board near the
window in the Telegram Room, stating that the
committee would be glad of any information con-

TO -DA Y 6 1

cerning the , which left, say, London for Mel-
bourne on such and such a day. The following
Wednesday, if no news has been received in the
meanwhile, a notification is posted up that the

left London for Melbourne on the day

of , and has not since been heard of Thus

is a vessel " posted as missing " at Lloyd's, and
on the day this formality is gone through the loss
is payable by the underwriters, and collected by
the brokers who effected the insurances. The
wages of the missing crew are also payable up
to that time, but by that formality the unfortu-
nate men are legally adjudged to be dead, and
probate of their wills can be obtained, and Letters
of Administration taken out. Diligent search and
enquiry has not revealed any instance of a vessel
once posted as missing ever afterwards re-appear-
ing. Some few years ago, a little coaster, not
having been heard of for many weeks, on a short
voyage, was put up for inquiry at Lloyd's, and
the notice elicited the information that the missing
craft was snugly ensconced in a haven on the
West of Ireland coast.

A vessel called the Pym, twice ran a very near
risk of being advertised as overdue, on a voyage
from the States to Japan, taking five and a half
months to reach the Straits of Anjer, and another
five and a half to get to her destination. Instances,
however, have been known of the crew of a
" posted " vessel re-appearing, Enoch Arden-like,
after all their friends had given them up for dead.
Many years ago, a ship going out to the East, after

62 LLOYD'S YESTERDAY AND TO-DAY

doubling the Cape of Good Hope, got a long way
out of her track to the southward, and eventually-
struck on one of the islands of the Crozet group.
Here the survivors of the wreck, " set in this Eden
of all plenteousness," remained for five long, weary
months, recking little of the tropical beauties of
their earthly Paradise, and eager only for that de-
liverance which was so long in coming. Eventu-
ally, one of Her Majesty's ships, cruising in the
neighbourhood for castaways, saw their signals,
and took them aboard. When they arrived in
England, however, they were as dead men come
to life again ; and many of them found that, with
the fickleness characteristic of sailors and sailors'
wives, their " widows " had married again. What-
ever may be the legal position of a man in such
circumstances, the actual situation is painful in the
extreme ; and unfortunately the sequel must be
left to conjecture, as history does not supply posi-
tive information.

Another similar case was that of the Derry
Castle, which was wrecked on Enderby Island
in the Pacific. There was no time to save any-
thing from the wreck, as the vessel went to pieces
almost immediately ; and when the survivors
landed on the beach with hardly anything but the
clothes they stood up in, and those dripping wet,
their consternation and dismay may be imagined
on discovering that only one of their number
possessed a match, and he not a boxful, but one
solitary liicifer. The description of the care with
which this treasure was laid out in the sun to dry ;

TO- DA V 63

of the casting of lots as to who should strike it ;
of the feverish anxiety lest a puff of wind should
extinguish it on being applied to the pile of dried
grass and driftwood, arranged with such infinite
care ; and the sighs of relief that escaped the poor
fellows as they u-atched the thin blue smoke of
their fire curling heavenwards — all this would
require the pen of a Stevenson, or a Jules Verne
to do justice to. For several weeks this fire was
kept constantly burning, the men living during
this time on clams, fruits, land-crabs and such
natural products as the island afforded. And
when, by means of a raft, some of their number
succeeded in reaching a neighbouring island, on
which a Government ship, patrolling the Pacific,
had left stores for such as them, their joy was
only exceeded when their rescue was effected a
month or two later. Plere again their ship, not be-
ing heard of, was posted as missing, and the crew
afterwards turned up to tell the story of her loss.

The American barque Tezvkeslniry L. Sweat was
not actually posted as missing, because no insur-
ances were placed at Lloyd's upon her, or her cargo,
but the friends of the crew had long given them up
for dead, when they re-appeared as it were from
the grave. The story of their adventures reads like
a romance. The vessel was on a voyage from
Newcastle, N.S.W., to Hong Kong, and, a month
after sailing, encountered a gale which drove her
ashore on Susanne Reef, near Pozeat Island, one
of the Carolines. The vessel went to pieces soon
after she struck, and nothing was saved from the

64 LLOYD'S YESTERDAY AND TO-DAY

wreck but one chronometer. The crew escaped
in one of the ship's boats, and managed with
great difficulty to reach a small islet to the north-
ward. From this islet, after the storm had sub-
sided, they made the island of Pozeat, which is
inhabited by fierce savages. As the boat ap-
proached the island a fleet of canoes put off from
the shore, the men being armed with knives and
spears. Some of the savages in their eagerness
jumped overboard and swam to the boat, each
with a long knife held between his teeth. The
first savages to reach the boat clambered in until
the boat was nearly swamped. Then they began
to strip the sailors of their coats and outer gar-
ments, until they had despoiled them of every-
thing but their undershirts. During all this time
a tremendous babel of shouting and singing was
going on, not only from the men, but from a crowd
of women and children, who were dancing about on
the shore. The sailors expected no better treatment
than to be killed and eaten, but, as they learnt after-
wards, the natives of this island are not cannibals.

While the shipwrecked crew were standing sur-
rounded by this yelling mob, a man dressed, as
all the others, merely in a hip cloth, came forward
and spoke to them in English. He gave his name
as Charles Irons, an Englishman by birth, and
offered to render any assistance in his power. He
had, it appeared, been left at Pozeat by a trading
vessel a few years previously, his business being
to represent traders in Cocoanut Island, but the
vessel which left him had failed to call for him,

TO-DA Y 65

and he had gradually assumed the habits of the
natives, becoming more or less like them in
appearance and manner. He had taken to him-
self seven wives, and was regarded by the natives
as a man of importance, second only to the chief
of the tribe. The man had even forgotten many
of the details of civilization, but he proved of good
service to the captain, and was no doubt the means
of saving him and his crew.

A day or two after landing at Pozeat, Captain
Gooding, the master of the Tezvkesbiiry L. Siveat,
who had become uncertain about his reckoning
of time, and did not know exactly whether the
day was Thursday or Friday, asked Irons if he
knew what day of the week it was. Irons
answered that he did not ; and more than that —
he did not know what year it was. He, however,
interested himself on behalf of the shipwrecked
men, and hired a canoe from the natives. Captain
Gooding, the second mate, and one of the ship's
crew, set sail ten days after arrival, leaving the
first mate, and the rest of the crew, seven in all,
at Pozeat. In this craft the captain and his men
made their way from island to island, touching at
many different places, and making stops at each,
varying from two days to a month, finally arriving
at Ruk, where there is a missionary station. Here
they were cared for by the missionary, and ob-
tained the use of the boat belonging to the station.
In this boat the captain and his faithful crew
again set sail, making for Pozeat, which they
reached in safety, and returned to Ruk with the

E

66 LLO VD'S YESTERDA V AND TO-DA V

mate and men they had left behind. Two months
later the missionary vessel, Mornino; Star, arrived
and took them all to Honolulu, where they arrived
nearly nine months after they had set sail from
New South Wales.

It may be added that the man Irons declined to
accompany the sailors when they left, preferring to
retain his savage freedom, and his seven wives. Pos-
sibly the restraints of civilization, to which he had so
long been a stranger, had no attraction for him, or,
may be, the prospects of his becoming chief of the
tribe, opened up to him an avenue of ambition which
he was fain to tread. Anyhow he preferred to be
left where he was, and may perhaps be there still.

No system for the recording of losses, however
elaborate and extensive, would be complete with-
out an equally careful chronicle of arrivals. This
is made in two huge volumes, of the size of the
Loss Book, which are placed on stands at the
entrance to the Reading Room. One book is kept
for the entry of all arrivals of vessels at foreign
ports, and the other at home ports, and both are
constantly perused by underwriters.

Of late years a " Confidential index " has been
published, showing the histories, tonnages and
losses of all British steamships of lOO tons and
upwards, the number of shares held by the
managing owners, the number of shares mort-
gaged, the names, and subsequent employment, of
officers of both the sailing and steam mercantile
marine whose certificates have been suspended,
and much other important and useful information.

STUDYING THE ARRIVALS.

CHAPTER IV.
INSURANCE FRAUDS.

EVEN with all the safeguards described in the
last chapter, underwriters are, from the very
nature of the business, particularly exposed to
frauds by unscrupulous persons. Every one is
familiar with the story related by Charles Reade,
in " Foul Play," of how an owner of two vessels
which were coming home from Australia — one
with a cargo of copper, and the other gold — caused
the cargoes to be transferred from one to the other
before sailing, in order to defraud the underwriters.
The ship supposed to contain the nuggets, but
which in reality had the copper on board, was
scuttled, and a total loss claimed as for the gold.
The story seems highly improbable, and most
likely owed its origin to the fertility of the
novelist's brain ; but that equally fraudulent prac-
tices are by no means altogether things of the
past is unfortunately only too true. Only a year
or two ago, a vessel on a voyage from a small port
in Spain to the Plate, and stated to have a valuable
cargo of wine on board, was lost off the Cape
Verde. A claim was, in due course, made upon
the underwriters ; but, their suspicions being

aroused at so large a value of wine coming from

67

68 LLOYD'S YESTERDAY AND TO-DAY

so small and insignificant a port, investigations
were made, which resulted in the discovery that
most of the casks of wine (?) were filled with
coloured water, and the claim was repudiated in
toto. The fraud was discovered by an examination
of the customs' returns of the port in question,
which revealed the fact that the quantity of wine
shipped from the place during a whole year did
not amount, in the aggregate, to that which was
stated to have been on board the scuttled vessel.

Another fraud on similar lines, which happened
many years ago, is a tradition at Lloyd's. A vessel
said to be carrying specie to a very consider-
able amount, and insured in the Room, left the
Thames for the West Indies. The vessel ran on a
reef not very far from her destination, and was re-
ported by the captain, who with the crew was
saved from the wreck, to have slid off the rocks
and foundered in deep water. The prospects of
salvage did not, however, appear to the underwriters
interested as hopeless as the reports were calculated
to lead them to believe. What the Americans, by
a curious misapplication of terms, call a " wreck-
ing " expedition, was despatched, and the vessel
was found, but the specie was not, and extensive
searching did not reveal to the astonished salvors
anything more valuable than a cargo of stones !

Drawing again upon the records of the distant
past, perhaps the best story of fraud on under-
writers is that of "the noted Captain Codling" —
the best because it possesses such an excellent
moral. I cannot do better than repeat it as related

INSURANCE FRAUDS 69

in Mr. Frederick Martin's admirable " History of
Lloyd's and Marine Insurance."

" Early on a fine Sunday morning, on the 8th of
August, 1802, while the sun was shining bright
upon a calm sea, the promenaders on the beach of
Brighthelmstone, or Brighton, were surprised to
behold a brig in the offing only a few miles from
shore, evidently in a sinking state, and yet making
no signals of distress. A number of fishermen's
boats had pushed off already to offer their services
to the strange vessel ; but, when approaching it,
the captain sternly ordered them away, declaring
with an oath, that he would not allow any one to
come on board as long as he was there, the master
of his own property. Compelled to do so, the
fishermen stood away, hovering about the sinking
vessel, and their movements, and the noise made
by them upon the quiet and almost waveless sea,
soon brought up a small man-of-war cruising
about, the revenue cutter Swallow. Unlike the
fishermen, the officer in command of the cutter,
Captain Amos, paid no attention to the order to
stay away from the brig, but, taking her in tow,
without long parley, commenced pulling her to-
wards the shore. But it was found that the brig
was thoroughly water-logged, and when still about
two miles from the shore, she sank, but in water
not deep enough to prevent the two masts from
appearing over the surface. The captain and crew
of the sunken vessel, before this, had taken to a
boat, prepared in every detail to receive them, and
they quickly rowed ashore, stared at by the crowd

70 LLO VD'S YESTERDA V AND TO-DA V

of idlers at the beach, some of them expressing
wonderment at a shipwreck occurring on such a
day at such a place. No attention was paid to
these remarks ; but the group of shipwrecked
mariners straightway marched to the nearest inn,
the Old Ship. Here the leader gave his name as
Captain William Codling, commanding the brig
Adventure from London, now lying wrecked on
the sands facing the inn.

The brig Adventure had left the River Thames
on the 8th July, 1802, bound for Gibraltar and
Leghorn, with a general cargo, declared to consist
of cutlery, plated goods, watches, musical instru-
ments, and similar articles. The owners of ship
and cargo were two London merchants of good
repute, Mr. George Easterby and Mr. William
Macfarlane, who, before the vessel sailed, gave
orders to several brokers to get policies of insur-
ance at Lloyd's on their property, to the amount
of between four and five thousand pounds. The
insurances were duly effected, the principal under-
writers being Messrs. Joseph Marryat, Robert
Shedden, James Nash, Thomas Rider, William
Ness, and James Honyman. This done, the Ad-
venture went to Yarmouth, where a small quantity
of goods, certified of like description as the previous
cargo, was shipped, the owners at the same time
taking out additional policies at Lloyd's, which
nearly doubled the amount of insurances previously
secured. At Yarmouth the supercargo of the
vessel, Mr. Edward Storrow, suddenly left, de-
claring he would go no further in the Adventure

INSURANCE FRAUDS 1\

and his place was filled by Mr. John Reid, sent by
the owners from London. After staying at Yar-
mouth for nearly a week, the brig directed her
course to Deal, and from thence went back to
Aldborough, where the captain went on shore at
night, for an interview with some persons that had
come to the place. Setting once more sail now,
the Adventure %o\. to the Downs, throwing anchor
amidst a mass of shipping waiting for a favourable
wind to leave the Channel. Here the mate, follow-
ing the example of the supercargo, declared his
intention not to proceed further, which was not
objected to by the captain, who filled his place by
a common sailor, Thomas Cooper, notwithstanding
the earnest declaration of the latter that he knew
nothing of navigation, and could not possibly
execute the duties thrust upon him. After a short
stay in the Downs, hoped-for winds set in, and
thereupon all the vessels quitted their anchorage
and proceeded southwards, except the Adventure,
which waited several days longer. At last, on the
evening of Saturday, the 7th of August, Captain
Codling gave orders to sail, and at the same time
had a keg of rum brought on deck, for the free use
of his crew. There was great merriment on board
the Adventure all the summer night through, which
continued till between seven and eight o'clock on
Sunday morning, when the captain and his men
took to the long boat, and comfortably went
ashore. It had taken Captain Codling just a
month to take the Adve?iture from the Thames to
get her stranded at the beach of Brighton."

72 LLOYD'S YESTERDAY AND TO-DAY

The underwriters on hearing the news next day,
at once despatched an agent to Brighton to in-
vestigate the affair. He immediately set to work
and had the brig raised and towed on shore. An
examination of her hull showed that large auger
holes had been bored into her sides, and the gimlet
not proving sufficient, a hatchet had been requisi-
tioned. The communication of these facts to the
underwriters led them to decide upon a criminal
prosecution, but the parties principally concerned
had fled. Ultimately, however, the supercargo,
the owners, and the skipper were all arrested, and
brought up for trial at the Old Bailey on the 26th
October, 1802. Reid was acquitted on technical
grounds, and the owners, though found guilty by
the Old Bailey jury, were afterwards acquitted inj
consequence of the defective state of the law, which
was powerless to reach those who were not actually
on board the vessel. Captain Codling, however,
was found guilty, and immediately sentenced to
death, the judge holding out no hopes of mercy,
and he was accordingly hanged at Execution Dock
a month later in the presence of a vast crowd of
people. The only thing to be regretted is that
Messrs. Easterby and Macfarlane escaped entirely
the punishment they so richly deserved, for after
all, it was they, and not the unfortunate captain,
that would have reaped the principal advantage,
had the nefarious plot to cheat the underwriters
been brought to a successful issue.

The following story of modern times shows the
daring and ingenuity that is frequently brought

ID*^^.<>. %

A DOORKEEPER.

INSURANCE FRAUDS 73

into play in the perpetration of frauds upon under-
writers, even though the amount involved be only
trifling. It was on the Friday previous to one
August Bank Holiday, some ten or twelve years
ago, that a broker at Lloyd's received instructions
from a new client to insure for ^^700 the yacht
Firefly, of which the client represented himself
to be the owner. He was going on the morrow,
he said, to take a trip to Boulogne, and he wished
the yacht insured for the voyage there and back,
and to assist the broker in effecting a policy he
left what purported to be a photograph of the
Firefly to be exhibited to the underwriters. The
insurance was duly effected, and the requisite
premium paid by the yachtsman. The Room, of
course, was closed on the Monday, and on the
underwriters' return to business the following day
the name of the Firefly was among those that
had been entered in the Loss Book in the interval.
The account of the loss, as reported to Lloyd's,
was that all had gone well until off the Island of
Sheppey, when the yacht had been caught by a
sudden gust of wind and capsized. The owner
and a friend — the only persons on board — had
managed to detach the row-boat before the yacht
foundered, and succeeded, after great difficulty, in
rowing ashore at Sheerness, in a thoroughly ex-
hausted condition. There they related their ad-
venture to the proper authorities, and sought the
nearest hotel, where they stayed in bed all Sunday.
The claim for the loss of the yacht was presented
in due course, but in the meanwhile the suspicions

74 LLOYD'S YESTERDAY AND TO-DAY

of the underwriters had been aroused in conse-
quence of the similarity of circumstances attending
this case and one which had come within their
knowledge on a previous occasion. The affair was
placed in the hands of a detective, who pursued
active enquiries all along the river from London
Bridge to Gravesend. Nobody had seen any yacht,
answering the description given, sailing down the
river on the day in question, but at Gravesend the
officer struck upon what afterwards proved to be a
very valuable clue. Two men, a Gravesend boat-
man said, had hired a rowing boat from him on the
Saturday before Bank Holiday and he had never
seen either them or the boat since. This clue, on
being followed up, resulted in it being proved that
the men who hired the boat at Gravesend, and the
shipwrecked yachtsmen, were the same persons.
They were subsequently arrested, and charged with
attempting to defraud, and in due course commit-
ted to take their trial at the next sessions. The
evidence given at the trial showed conclusively that
the prisoners had not embarked upon the yacht
at all, but had merely taken a boat at Gravesend,
and drifted down with the tide until they were well
clear of land, and had then turned back, and rowed
until they were really thoroughly exhausted. The
story they told on landing sounded plausible
enough, and their condition testified to the exer-
tions they had gone through ; and had they only
had the discretion to return the boat they had hired,
their little plot might never have been discovered
The photograph handed to the brokers was of a

INSURANCE FRAUDS 75

yacht belonging to the brother of one of the
prisoners. At the conclusion of the trial, both
prisoners were found guilty, one being sentenced
to two years' imprisonment and the other to twelve
months', both with hard labour.

The sequel proved one of them to be possessed
not only of remarkable coolness, but also of a
pretty wit. When his term of imprisonment had
expired, he addressed a letter to the leading
underwriter on the policy, in which he stated that
it was an axiom of Roman Law that a man could
not have another's blood and his money too, and
that whereas he had in his body paid the penalty
of his unfortunate mistake, the underwriters were
not entitled to his money, and he trusted that
they would return him the premium he had paid,
without delay, particularly as they had run no risk.
It is needless to add that this nai've request was
not complied with.

In all the cases hitherto referred to the fraud
was discovered before the money was paid by the
underwriters, and thus really became only attempted
frauds. But who can tell the story of the number
of cases in which underwriters are swindled without
detection ? It is probable that most of these would
show still greater ingenuity from the very fact of
their remaining undiscovered. The onus of proof
is always with the underwriters, and the difficulty
of obtaining this is oftentimes so great that the
latter, in many cases, deem it better to pay rather
than run the risk of an abortive or unsuccessful
action at law.

76 LLOYD'S YESTERDAY AND TO-DAY

Reference was made in the preceding chapter
to the unwarrantable condemnation of vessels at
ports of distress in which they have taken refuge.
For some reason or another the Cape, and the
islands of St. Michael's in the Azores, and St.
Thomas in the West Indies, seem to have become
of late years the favourite spots for owners who
are desirous of exchanging their insurance policies
for hard cash, and the facility with which they are
able to accomplish this would seem to justify their
selection. No doubt there are unscrupulous sur-
veyors everywhere, who will, under the judicious
application of " palm-oil," issue false reports as to
the condition of vessels they are called in to
survey, and Lloyd's agents are powerless to pre-
vent the underwriters being thus swindled. The
only remedy would appear to be the infliction of
very stringent penalties upon surveyors proved to
have thus offended.

A good example of this kind of fraud occurred
somewhat recently. A colonial barque on a
voyage from Philadelphia to a Baltic port put
into the island of St. Thomas, and reported having
encountered severe weather. A survey was held,
the vessel was declared unfit to carry on her cargo,
and was accordingly condemned. The cargo was
discharged, to be brought on by another ship, and
a total loss was claimed from the underwriters
on the barque and freight. The underwriters
on the latter were on the point of paying — if in-
deed they had not already handed over the money
to the broker — when the news came that the con-

INSURANCE FRAUDS 77

demned barque had changed her flag, and without
having effected any repairs, sailed from St. Thomas
in ballast for the mainland. The barque is still
afloat, but the owners never attempted to enforce
the claim they alleged to be due under the policies.

The substitution of iron in place of wood as a
material for the construction of vessels, has ren-
dered the auger a much less necessary weapon to
the unscrupulous owner of these days, for the
opening of a steamer's sea-cock will accomplish,
without trouble in half-an-hour, what a spike-
gimlet and much hard work would only have
achieved in twice the time, in days gone by. The
blue waters of the Bristol Channel which twice a
day ebb and flow past the little Isle of Lundy,
without a doubt conceal the rotting carcase of
many a steamer which found a berth on the sands
below through a cause very different from perils
of the sea. But the water is here too deep to
allow of a sunken steamer being raised. In the
majority of cases the underwriters have paid
the loss rather than go to court, lacking that
clear legal evidence which is necessary for a suc-
cessful verdict. But owners of foundered vessels,
whose hands are clean, do not accept fifty or even
seventy-five per cent, in satisfaction of their claim
when the courts of law are open for the remedy
of their grievances. And more than one case
could be cited of recent times of which such has
been the result.

The case which excited the most interest in
underwriting circles of late years, was that of the

78 LLOYD'S YESTERDAY AND TO-DAY

prosecution of a number of men for defrauding
underwriters by means of shipping horses, that
were insured much beyond their value, and causing
them to be poisoned on the voyage. This system
of fraud had been successfully carried on for a
number of years, until scarcely an underwriter
could be induced to quote for such risks at all.
So profitable a business, however, could not be
allowed by evil-minded persons to languish alto-
gether, and after a lull, to enable underwriters to
recover some of their lost confidence, operations
were resumed. But Nemesis awaited them.

In the summer of 1892 Lambert Barron, Andrew
White, William Catto, and John Machattie, were
indicted at the Central Criminal Court for con-
spiring to defraud underwriters in the manner
described above. Many eminent counsel were en-
gaged in the case, among them being the late
Solicitor-General and the present Home Secretary,
and the court was crowded with underwriters,
and others interested in marine insurance.

In opening the case for the prosecution, the
Solicitor- General said the prisoners were charged
with conspiring with a man named Alexander
Stephens, who had been a horse dealer in Aber-
deen, but who had absconded, with a series of
frauds upon the prosecutors. The allegation was
that since 1890 the accused had consigned
numerous freights of horses, which they had very
much over-insured, from this country to the Cape
and America. Some of these horses had died in
a mysterious manner while on board ship, and

INSURANCE FRAUDS 79

heavy claims were made upon companies. These
claims were resisted, and it was ultimately decided,
unknown to the prisoners, to send out a veterinary
surgeon with the next cargo. The first case
mentioned was the shipment of four horses by
Machattie on board the Persian Monarch. These
horses were insured for ^^65 5. Two of them died,
and ^^415 was paid for the loss. In April of the
same year Machattie sent three horses by the
Concordia to Montreal, using the name of Mitchell.
In May, 1891, two horses were sent by the San
Francisco, to New York, and one of the horses
dying, i^207 was paid, and it was alleged that
Machattie received ;^I23 of the money. In August
of the same year two horses and forty ponies were
sent by the Buffalo, in charge of Barron, to New
York. The two horses died, and Machattie, who
had insured them, was paid ^280. The veterinary
surgeon was sent out with some horses which were
on the way to the Cape, and of which Catto was
in charge. One or two of the animals died at sea,
and the veterinary surgeon, on examining one of
the animals, came to the conclusion that death
was due to strychnine poisoning. The man in
charge of the horses was arrested at the Cape.
The intestines of another horse, which had died
on board another ship, were preserved and brought
back to this country. Strychnine in large quan-
tities was present. Both White and Catto were
brought back from the Cape in custody, but Barron
returned under an assumed name, and was not
arrested for some time afterwards. Evidence was

8o LLOYD'S YESTERDAY AND TO-DAY

given to prove the purchase by the man Stephens
of large quantities of strychnine in Scotland, and
a large number of witnesses were called to prove
the insurance of horses, the death of several of
them, and the claims which were made in respect
of their loss.

Three horses shipped to the Cape by the s.s.
Pretoria, were insured for ;^ 1,400 being, in the
opinion of the captain of the steamer, worth about
£\o each. Catto admitted having given one of
the horses a solution of aconite, which, he said,
had been given to him by his employer ; and the
evidence of the veterinary surgeons left no room
for doubt as to the manner in which the animals
had come by their death. No witnesses were
called for the defence, and the jury found all the
prisoners guilty.

The learned judge sentenced Barron and Ma-
chattie to twelve months' hard labour each, and
to pay a iine of ^250 each, and remain in gaol
until the money was paid. White and Catto were
each sentenced to three months' hard labour.

Perhaps the knowledge would not afford Messrs,
Barron & Co. much consolation, but it neverthe-
less is a fact that until the first year of the reign
of Queen Anne the law did not include insurance
frauds among the list of punishable offences.
Possibly it regarded underwriters merely as
gamblers, and the legitimate prey of rogues, unde-
serving the protection of the law. Whatever the
reason, the fact remains, and even at the present
day the law regarding such crimes, in spite of

VW.D.

A GLANCE AT THE LOSS BOOK.

INSURANCE FRAUDS 8i

many legislative attempts in the right direction,
is not, by any means, what most underwriters
would like to see it. Increased facilities of com-
munication have, however, rendered impossible
nowadays frauds which, in former times, were
of comparatively common occurrence ; and Board
of Trade inquiries, with the attendant pains and
penalties on conviction, have done much to deter
swindlers and assist underwriters.

CHAPTER V.

THE "ROOM."

"TV T O sketch of Lloyd's would be complete
^ ^ without some description of the building
where the head quarters of marine insurance are
at present established. One might pass the
Royal Exchange a hundred times a day without
being aware of the existence of Lloyd's ; but if he
were to station himself on the east side of the
building between the hours of eleven and four, he
would notice a constant stream of people hurrying
in and out of the main entrance, most of them
with a busy, preoccupied air. Passing through the
great iron gateway, and turning sharp to the
right, the visitor finds himself in front of a large
doorway, over the fanlight of which is the brief
inscription " Lloyd's." Pushing open the swing
door, a broad staircase leads up to the first floor,
where the underwriting is conducted. At the top
of the stairs the stranger finds his further progress
arrested by a barrier, guarded by an official re-
splendent in scarlet robes and gold-banded hat,
whose vigilant eye is ever open to detect intruders.
As a modern facetious writer ^ says : —

You may enter into Lloyd's,
Like a flight of asteroids.

Up the shoot.

* Goosestep.
82

THE ''ROOM" 83

Or go singly, or in pairs,
Up the broad stone flight of stairs,
Foot by foot.

But whichever way you rise,
At the top will meet your eyes

Men in red ;

Who will hold you in review,
And decHne to pass you through
Unless led.

If you want to call a friend.
They shout out, while you attend,
His cognom.

Who with ceremony short
Comes and takes you through the port
To the Room.

When you find yourself within,
Such a buzz and such a din.

You will hear ;

Such a bustle and a rout
And a running round about.

Far and near.

Many men with anxious looks,
Scanning large wide-open books,

You will find ;

And as they seem grave or gay.
So the index they display

Of their mind.

For the game of pitch and toss
With the ocean oft means loss,

Which is sad ;

And the perils of the seas
Have been known to send with ease
To the bad.

Men who started with good hope
And a goodly stock of rope.

Sailing free,

84 LLOYD'S YESTERDAY AND TO-DAY

Till their premiums grew small,
And their losses grew so tall

D'ye see,

That they could no longer run
Their career, and, as the sun

Slithers down,

Went down, and were seen no more,
Or derelict drove ashore,

Quite done brown.

Lloyd's is virtually a club, and therefore only
open to members. Subscribers may, of course,
introduce friends to show them round, but the
presence of strangers is not encouraged : though
in this respect Lloyd's is not quite so exclusive as
the Stock Exchange. The stranger mentions to
the janitor the name of the member he wishes to
see, and this is repeated to the " caller," who
stands in a kind of pulpit with a sounding-board,
in the large Underwriting-Room, and who sings
out the names in bell-like, stentorian tones. As-
suredly an exceptionally good pair of lungs is
needed to make one's voice heard above the noise
and bustle which fills the place and catch the
ears of those at the far end of the room, where the
huge clock and anemometer are faithfully recording
the flight of time, and the variations of the wind.

In the wall of the large room stand the Arrival
Books and the Loss Book before referred to, and
in the wall over the latter is erected a tablet to
commemorate the distinguished services rendered
by the Times newspaper to the mercantile com-
munity in unearthing and exposing one of the most
gigantic swindles ever planned by unscrupulous
rogues. The Tablet bears the following inscription :

;. ! ' , ill :^-■^•.

^ .V

THE CALLER.

THE ''ROOM'' 85

This Tablet

Was erected to commemorate the extra ordinary exertions

of The Times Newspaper

in the

Exposure of a remarkable Fraud

upon the Mercantile Public, which exposure subjected the

Proprietors to a most expensive lawsuit.

"At a meetin.!^ of Merchants, Bankers, and others, held
at the Mansion House, on the ist day of October, A.D. 1841,
The Right Honourable The Lord Mayor in the chair, the
following resolutions were agreed to, videlicet : —

" That this Meeting desires to express, in the most un-
qualified terms, its sense of the indefatigable industry,
perseverance and ability shewn by the Proprietors of the
Times newspaper in the exposure made through the in-
strumentality of that Journal in the trial " Bogle versus
Lawson," of the most remarkable and extensively fraudulent
conspiracy ever brought to light in the Mercantile world.

" That this Meeting desires to offer its grateful acknow-
ledgement to the Proprietors of the Times newspaper for
the services which they have thus been the means, at great
labour and expense, of rendering to the Commercial Com-
munity throughout Europe.

"That the effect of such exposure is not only highly
useful to the Commercial and Banking Community, as
suggesting additional care and circumspection in all
monetary dealings, but as shewing the aid which a public-
spirited and independent journal has in its power to afford
in the detection and punishment of offences which aim at
the destruction of all Mercantile confidence and security.

" That the Committee now appointed be empowered to
take measures for the purpose of recording in a more per-
manent manner the sense of obligation conferred by the
Proprietors of the Times refusing to be reimbursed the
heavy costs incurred by them in the Defence of the aUove-
mentioned action, the Committee opened a subscription
which amounted at its close to £2,j(Xi, and at a Meeting
held at the Mansion House, on the 9th of February, A.D.
1842, specially summoned for the purpose of considering the
application of the amount subscribed, it was resolved as
follows : —
" That one hundred and fifty guineas be applied to the

86 LLOYD'S YESTERDAY AND TO-DAY

erection of this Tablet, and of a similar one to be placed in
some conspicuous part of the Times Printing Establishment.

" That the surplus of the fund raised be invested in the
purchase of three per cent, consols, the dividends to be
applied in the support of two scholarships to be called the
Times Scholarships.

"That the Times Scholarships be established in connection
with Christ's Hospital and the City of London School for
the benefit of pupils proceeding from those Institutions
respectively to the universities of Oxford or Cambridge.

" That Christ's Hospital and the City of London School
be required to place in their respective institutions a Tablet
commemorative of the establishment of such scholarship.

" All which has been duly carried into effect.

" The Committee consisted of the following Gentlemen : —

The Right Honourable Sir John Pirie, Bart., Lord
Mayor, Chairman, and Treasurer.

Mathias Wolverley Attwood, Esq.

Barclay Bros. & Co.

Baring, Bros.

Samuel Briggs, Esq., of the firm of Briggs & Co., of
Alexandria.

Sir George Carrol, Knight, Alderman.

Cattleys & Carr.

COCKERELL & Co.

Glyn, Halifax, Mills & Co.

Robert Alexander Gray, Esq., of the firm of Mel-
HUiSH, Gray & Co.

John Benjamin Heath, Esq., of the firm of Heath,
Furse & Co.

William Hughes Hughes, Esq., F.S.A., F.L.S., etc,
(Honorary Secretary).

Thomas Johnson, Esq., Alderman, late Lord Mayor.

Jones, Lloyd & Co.

Sir Peter Laurie, Knight, Alderman.

Peter Laurie, Esq., Common Pleader of the City of
London.

Sebastian Gonzalez Martinez, Esq., of the firm of
Martinez, Gassiot & Co.

John Masterman, Esq., M.P. (of the firm of Master-
man, Peters, Mildred, Masterman & Co.).

Francis Pegler, Esq., of the firm of Pegler Bros.

John Diston Powles, Esq.

THE "ROOM'' 87

William George Prescott, Esq. (of the firm of

Prescott, Grote, Ames, Cave & Grote).
Baron Lionel Nathan de Rothschild, Esq.
Edward Stewart, Esq.
Patrick Maxwell Stuart, Esq., M.P.
Samuel Wilson, Esq., Alderman.

William Hughes Hughes, Honorary Secretary."

The outline of the case is worth sketching here.
On the 1 8th May, 1840, the Brussels correspondent
of the Times startled his readers by stating that a
great forgery Company, established on the Conti-
nent, had lately been detected and blown up, the
object of the company being to plunder the Conti-
nental bankers of about ;^, 1,000,000 sterling, by
means of forged letters of credit, purporting to be
of the banking firms of Glynn, Halifax, Mills &
Co., of London. The letter concluded by giving
the names of the conspirators, among them being
that of the plaintiff, a partner in a banking house
at Florence. The other principal actors in this
astounding conspiracy were a French Marquis,
connected by marriage with this country ; a Baron
and Peer of France ; his son ; a Count ; a Scotch
gentleman and M.P. ; and his son.

An action for libel was commenced on the 30th
June, 1840, and after an exhaustive trial, con-
cluded in August, 1 84 1, by the return of a verdict
for the plaintiff, damages one farthing, without cer-
tificate for costs. The expenses of the Times had
been enormous, for in maintaining their defence
the proprietors had sent their emissaries all over
the Continent to obtain proof of the truth of their
allegations, a whole host of witnesses were called,

88 LLOYD'S YESTERDAY AND TO-DAY

and the most eminent counsel of the day engaged.
In commenting on the verdict, the Times said,
" We have performed a duty we owed to our cor
respondent, to ourselves, to the bankers of Europe,
and to the community at large, and we have every
reason to be contented with the result." The Ob-
server, however, thought that some public recogni-
tion of the services of the Tunes was due, and
early in September asked, " Where is the gratitude
of the community ? What has become of the
public spirit of the City of London ? What are
the bankers, and merchants, and ' letter-of-credit '
men about ? Why do they not bestir themselves
to express the gratitude which it is trusted they
feel, in a tangible manner?" To this appeal the
members of Lloyd's were quick to respond, and
the tablet to-day bears witness alike to the enter-
prise of the journalistic, and the generous apprecia-
tion of the commercial, world.

Opposite the Times tablet is one over the Foreign
Arrival Book, flanked by the figures of two dis-
abled seamen, and inscribed as follows : —

" Erected
by the Governors of the
Seaman's Hospital Society
of the Port of London,
in memory of
John Lyddeker, Esq.,
South Sea Ship owner,
Gratefully to record his
munificent bequests to the
Institution.
He died on the 23rd July, 1832, and was buried in the
north vault of the Church of St. Dionis Backchurch, Fen-
church Street."

A BROKER OF TO-DAY.

THE ''ROOM" 89

From where one stands, just by the Loss Book,
a good view of the large Underwriting-Room is to
be had ; and a truly animated scene it presents.
Down the entire length of the room extend three
rows of desks, or " boxes," as they are technically
called. At these boxes, which accommodate three
a side, the underwriters sit at the receipt of custom^
while their clerks alongside are busy entering the
" risks " as they are accepted, signing policies, or
" taking down " claims that have been examined
and passed. Affixed to each desk is a wire recep-
tacle for policies which have been signed, from
which the brokers take them as they pass. The
gangways between the rows of boxes are thronged
with brokers and clerks, with cases of " slips " in
their hands, passing to and fro, between one under-
writer and another ; and no little dexterity is
needed to avoid cannons and collisions as one
pilots one's way along. A smaller Underwriting-
Room leads off from the left hand side at the
farther end of the room.

Reference has previously been made to the cus-
tom of wearing the hat at Lloyd's, and the preva-
lent baldness which may or may not be an effect
thereof Another fact which may contribute to
the scarcity of hirsute covering among the habitue's
is the defective ventilation of the Room. Many
hundreds of pounds have been spent in the en-
deavour to obtain a good system of ventilation, but
in spite of this, and the fact that the electric light
is used for illumination, the Underwriting-Room
often becomes oppressively close towards four

90 LLOYD'S YESTERDAY AND TO-DAY

o'clock. The Reading-Room, which communi-
cates, affords a pleasant retreat from the stuffy-
atmosphere of the former, and there one can read
the newspapers of almost every part of the world.
Should these, however, prove dry, the Captains'-
Room possesses still further attractions. Here,
doubtless, in former days old salts were wont to
meet, and sail their voyages o'er again ; but now-
adays the place is used chiefly as a luncheon-
room. For an hour or two during the day the
place presents as busy an appearance as any chop-
house in the City. An old-fashioned custom still
clings to the place, in the periodical sales of ships
by auction that take place. A high desk is placed
in the middle of the room, and, on a raised plat-
form, the auctioneer takes his stand, and proceeds
to detail the merits of some particular vessel and
invite a bid, while the members unconcernedly dis-
cuss their mid-day meal, heedless alike of the rattle
of auctioneer's hammer and the strangers that have
flocked in to bid. The Captains'-Room on these
occasions is open to all comers, and it is the
strangers who, for the most part, form the in-
terested section of the salesman's audience.

Before leaving the building altogether, a peep
into the secretary's office will well repay the visitor.
Round the walls are hung various curiosities re-
lating to the business, such as the policy on the life
of Napoleon before mentioned, and the autograph
letter of the Iron Duke in his capacity as Warden
of the Cinque Ports. Here is exhibited a print of
the reverse and obverse sides of Lloyd's medal, the

THE ''ROOM'' 91

possession of which is so highly prized by its re-
cipients. The subscribers of Lloyd's grant rewards
for humane and perilous exertion to save life from
shipwreck, which takes the form of a medal de-
signed by the late Mr. William Wyon, R.A. The
subject of it is taken from the Odyssey, where
Ulysses, after various adventures during his return
to his native Ithaca, subsequent to the fall of
Troy, is described as being rescued from the perils
of a storm by Leucothoe. The words addressed
by Leucothoe to the shipwrecked hero explain the
design on the reverse side —

"This heavenly scarf beneath thy bosom bind,
And live ; give all thy terrors to the wind."

The reverse is taken from a medal of Augustus —

a crown of oak being the reward given by the

Romans to him who saved the life of a citizen —

and thereon is inscribed the motto derived from

the same authority —

" Ob cives servatos."

In the centre of the room stands the " Lutine "

table before referred to, and a silver tablet let into

its surface bears the following inscription : —

" H.B.M. Ship La Lutine,

32 Gun Frigate,

Commanded by Captain Lancelot Skynner, R.N.,

Sailed from Yarmouth Roads

On the morning of the 9th October, 1799, with a large

amount of specie on board.

And was wrecked off the Island of Vlieland the same night,

When all on board were lost except one man."

" The rudder of which this table was made, and
the rudder chain of the bell, which the table sup-

92 LLOYD'S YESTERDAY AND TO-DAY

ports, were recovered from the wreck of the ill-
fated vessel, in the year 1859, together with a part
of the specie, which is now in the custody of ' the
Committee for managing the affairs of Lloyd's.' "

Alongside the table is the stiff, high-backed
carved chair, thus inscribed : —

" This Chair

is made from the wood of the rudder of

H.B.M. Frigate La Lutine,

Which sailed from Yarmouth Roads

On the morning of the 9th of October, 1799,

With a large amount of specie on board.

And was wrecked the same night off

The Island of Vlieland, when all on board perished,

With the exception of one man.

The rudder was recovered from the wreck in 1859,

Having been submerged 60 years."

The commodious Committee-Room, which ad-
joins the secretary's office, is also full of interesting
relics, which Colonel Hozier, the courteous secre-
tary, and his subordinates are ever pleased to show
to the accredited stranger. As one leaves the
office, the eye is caught by an ancient time-stained
document which is framed and hung up there. A
closer examination reveals to the visitor the fact
that he is looking at the oldest policy in the poses-
sion of Lloyd's. It is dated January 20th, 1680, and
was for ^1,200 on ship (valued i^200 !) and goods
(valued £ i ,000) of the Golden Fleece, on a voyage
from Lisbon to Venice. The premium of ^4 per
cent, is enough to make the mouths of modern
underwriters water, as in these days of competition
rates have been cut down to the finest point com-
patible with profit, and sometimes even below that

THE ''ROOM'' 93

Speaking of rates, a story is told of a once
popular and successful underwriter of the last
generation, Mr. Arthur Hammond. Mr. Ham-
mond was looked upon in the Room as the best
authority upon Baltic risks, and a broker who
secured his initial as the lead on his slip could rely
upon completing the insurance without much diffi-
culty. One day, a broker brought him a slip
already started by another underwriter at a rate
slightly below that which had been for years re-
cognised as the market premium. Mr. Hammond
had already quoted his price for the risk, and on
the broker bringing back the slip with the initials
of a brother underwriter thereon at the reduced
rate, the old gentleman laid down his pen with a
gesture of disgust, and exclaimed, " I'll never write
another risk again ! " And he never did.

Such is the institution which, week in week out,
is quietly and unobtrusively doing its work in the
heart of this busy city. It must not be forgotten
that there are two separate and distinct aspects
of Lloyd's ; first as a Corporation, and secondly
as an aggregation of individuals carrying on busi-
ness as brokers, or underwriters, for their own
personal profit, and on the strength of their own
good names. Lloyd's as a Corporation has no
financial liability in the event of the failure of any
of its members or subscribers. All it does, in its
corporate capacity, is to ensure as far as possible
the admission only of men of stability and repute,
by means of more or less stringent tests, and the
exaction of a pecuniary deposit or guarantee.

94 LLOYD'S YESTERDAY AND TO-DAY

These financial guarantees are varied according as
a person is desirous of becoming an underwriting
or non-underwriting member, an annual subscriber
or an associate. Any one desirous of becoming a
member must procure a recommendation signed by
six members, who must attend the committee, if
required, to answer such questions as may be put
relative to the candidate. This application form,
setting forth the name, address, occupation, etc.,
of the candidate, and the names of the members
recommending him, is then posted up in the
" Chamber of Horrors " at least seven days before
the day of election. The committee sits once a
week, and the election is taken by ballot, a mere
majority of those present being sufficient to ensure
election. The same process is gone through in
the case of subscribers and associates, except that
in their cases the recommendation may be signed
by subscribers or associates, and not necessarily
members. An underwriting member elected after
the 31st December, 1890, besides being required
to deposit with the committee ^^5,000 or i^6,ooo
(for which of course he receives interest, and which
is returnable to him three years after ceasing to be
an underwriting member), is called upon to pay an
entrance fee of i^400, and an annual subscription
of twenty guineas ; but members elected prior to
31 st December, 1892, are let off with an annual sub-
scription of sixteen guineas. A non-underwriting
member is exempted from the deposit, and, after
satisfying the committee as to his means, etc., is
only required to pay an entrance fee of £2^, and

THE ''ROOM"

an annual subscription of seven guineas. An
annual subscriber pays no entrance fee at all, but
merely an annual subscription of seven guineas,
and an associate five guineas. The title of asso-
ciate is a recent innovation, and is applied to
gentlemen unconnected with marine insurance
business, but paying an annual subscription and
enjoying such privileges as the committee may
from time to time determine. These are the re-
gulations as they exist to-day but they have been
several times altered, and the payments vary
according to the date of admission.

From its earliest years, as has been shown,
Lloyd's has enjoyed a reputation for honourable
dealing, of which the Corporation is justly proud ;
and by generation after generation is the tradition
handed down for its successors to maintain. The
honour of Lloyd's has been the subject of unquali-
fied admiration and commendation both before
Parliamentary Committees and the full House of
Commons. In fact, it was there publicly stated
{inter alia) that the underwriters have been known
to dispute a point of law when the assured could not
produce a certain voucher, and without which they
could not possibly hope to succeed. The assured
were unable to produce the voucher, but when the
underwriters found that the issue of the action de-
pended upon this, they decided that although the
verdict was actually in their favour, they would
rather be cheated, and pay the loss, amounting to
some thousands of pounds ; and they did so.

Innumerable instances might be given of where

96 LLOYD'S YESTERDAY AND TO-DAY

claims have been settled, not on the basis of
justice, but in the larger spirit of generosity ; and
it is this liberality which goes far to justify the
proud boast that a Lloyd's policy is never disputed.
Though this of course is not literally true, still it
must be admitted that Lloyd's sets an example of
commercial honour and integrity that might with
advantage be more generally imitated. In short,
the eulogistic biographer of Mr. Angerstein was
scarcely exaggerating when he wrote that " Lloyd's
Coffee-house is now an empire within itself — an
empire which, in point of commercial sway, variety
of powers, and almost incalculable resources, gives
laws to the trading part of the universe ; and, if
combining its authority with the great mass of
business below [the Royal Exchange], there is not
a place upon the face of the earth that can vie
with this palladium of English merchants."

O

UNIVERSITY OF CALIFORNIA LIBRARY

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Form L9-Series 444