"Exactly so. You catch my meaning perfectly."
"There are two ways, then," the other said. "One is to let the risks in force expire, paying the losses as they occur; that will take about five years. The other, which is the usual way, is to pay some other company to assume the liability on all our outstanding policies—to reinsure us. We pay a lump sum, and the other company pays the losses as the risks expire, instead of our doing so."
"I see the idea. But what company would do that? And wouldn't it cost a small fortune to get any one to? And isn't this a bad time to approach any company with such a proposition?"
"No, I don't think so. Some company might be glad to get hold of a large amount of cash which it could use to pay its own Boston losses, and then it could pay the losses on our outstanding business, which would come along gradually for several years, out of its own normal profits in that time."
Mr. Murch looked at O'Connor with more respect.
"That sounds plausible. How much would it cost—in round numbers?"
"Our reinsurance reserve is about $1,500,000. I should think a company might be found to take it over for about two thirds of that sum. You see, we have a valuable agency plant and a good business, and although you want to get rid of it, it would be considered by most companies as well worth having. The company that took over our risks wouldn't let them expire; that company would hold on to them and secure them on renewal."
"How can this be arranged?" Mr. Murch inquired.
It was like cutting off his right hand to reply, O'Connor reflected, but he did so.
"Mr. Simeon Belknap usually manages such matters," he said. "Naturally he doesn't manage them for nothing; but he does the trick, and he's much the best man for it. He has probably engineered four fifths of the important reinsurance deals that have gone through in this country. No one has ever discovered why these things gravitate so unerringly to him—but they do. He will undoubtedly be pleased to find you a reinsurer for the Salamander."