The Stourbridge Observer, Cradley Heath, Halesowen & District Chronicle.
Stourbridge, West Midlands, England, 1878-01-26 00:00:00

LIFE ASSURANCES.

"A Policy-holder of 25 year Standing" recently sent a
letter to The Times drawing the attention of Life Assurers
to what he designates a crying evil—=the absence of any
notice of default of payment. This has elicited other letters
upon the same subject, of which we give the following :

Sir,—" A Policy-holder of 25 years' Standing" says
that none of the assurance companies gives notice of
default, and that the money value of lapsed policies
goes exclusively into the pockets of the companies.
As a matter of fact, many companies do give notice
of default, and many also allow to the assured the
money value for a lapsed policy.
In spite of his 25 years' standing, your correspon-
dent's experience has not been large enough.—l am,
Sir, yours obediently, J. W.

Sir,—Allow me to add my testimony to that of "A
Policyholder of 25 years' standing."
I am insured, and on two occasions (once through
forgetfulness, and once through non-delivery of notice)
have discovered to my horror that my life was unin-
sured. I not only received no notice of the fact from
the office, but was compelled to undergo a fresh
medical examination.

Being anxious to prevent such mistakes in future, I
asked the directors to have both my business and
private address placed in their books, and tendered the
amount for the double postage. This was refused.
From that time I have always recommended friends
to insure only with those companies that show some
little consideration for those actively engaged, who
may easily forget a date, or through travelling may
not receive a notice of the payment becoming due.
Thanking you for ventilating this important question,
I am, Sir, your obedient servant,
ANOTHER POLICYHOLDER.

Sir,—Having been insured for £l,OOO for several
years, I went from home one Christmas, leaving
written instructions with my banker to Tay my pre-
mium. He omitted to do so. Fortunately, I dis-
covered the omission a day or two before the " days of
grace" had expired. On calling at the office, I casually
remarked to the secretary that in such a ease where
the intention to pay the premium could be proved,
I supposed the policy would not be forfeited. His
answer was that the directors probably would insist
on its forfeiture. I afterwards insured my life for a
second £l,ooo—but in another office.—Your obedient
servant, EXPERT() CREDE.

Sir,—lf the Life Assurance companies would make
all the premiums payable on one day in the year—say
the Ist of January—policyholders would have no
trouble in remembering the date on which a premium
falls due. It frequently happens that a man insures
his life in several offices, and each new engagement is
made at a different period of the year • consequently,
the possibility of his overlooking the date of a premium
is always before him. _ . _

Apat7t from the advantage to the insurer which
would follow the adoption of a uniform date, the in-
surance companies would save considerably in clerical
labour, there being no dates to fill up, besides having
a large amount—the year's receipts, in fact—to invest
at one time, for which they would prepare accord-
ingly. As matters now stand, sums of all kinds are
coming in daily, and endless correspondence is necessi-
tated. I am aware that this proposal is altogether
opposed to the acturial mind; but as it has, at least,
the advantage of being simple and, I think, practical,
I shall be pleased if you will place it before your
readers.—l am, Sir, your obedient servant,

FLEET-STREET.

' Sir,—l trust you will allow me to enter my protest
against the sweeping charge made by your corre-
spondent "Policyholder of 25 Years' Standing"
against all British life insurance companies in conse-
quence of some instances of illiberal conduct on the
part of one or two. The practice of the British life
offices, taken as a whole, is much more liberal than
your cirrespondent appears to be aware of. lam
able to say positively that his statement, "none of the
companies give a policyholder official notice of de-
fault," is the very reverse of the truth, as many
companies regularly send a notice a day or
two after default has been made, and others
send a reminder a day or two before the
time for payment of premium expires. Ido not write
as the advocate of any office or of any class of offices,
and will therefore not enter into any particulars as re-
gards the other points raised by your correspondent.
It will be sufficient to say that those life offices which
understand their true interests are constantly engaged
in making conditions of insurance more and more
liberal. As regards lapsed policies, it is, I believe,
now quite an unusual thing for a surrender value to
be wholly forfeited in the circumstances stated by
your correspondent. Some offices bind themselves to
pay the surrender value at any time within five years
after the policy has lapsed. Others allow the policy
to be revived at any time within a year on payment
of the overdue premium, with a moderate fine, irre-
spective of the state of health or even the continued
existence of the life assured. Other companies, again,
will keep the policy in force so long as the surrender value
will allow by paying the premium and charging it as a
debt against the policy; while still another class of
offices have made a feature of granting non-forfeitable
policies, in which, when a premium is not paid, the
sum assured, with or in some cases without the appli-
cation of the policyholder, is reduced to an amount
corresponding to the number of premiums paid, and
is freed from payment of any future premiums. With
reference to your correspondent's concluding remark,
I may mention that it is by no means exclusively the
younger companies which have taken the lead in
removing restrictions upon life insurance and libe-
ralising its conditions. It will probably be found,
upon inquiry, that there is more diversity of practice
in life insurance than in any other kind of business.
so that a person who meets with illiberal conduct has
only himself to blame for not making inquiry before-
hand as to the regulations and practice of the office
with which he intends to insure. —I am, Sir, your
obedient servant,
T. B. SPRAGUE, a Vice-President of the Institute
of Actuaries.
Edinburgh, Jan. lg.

Sir,—Like almost all questions which possess any
practical importance or interest, a good deal may be
said on both sides as to the protection of holders of
life policies against an involuntary lapse an surrender
of their assurances. In the first place, however, it is
desirable to correct a popular impression that assur-
ance offices have any wish that their policies should
not be renewed. On the contrary, they have every
reason to encourage policy-holders to let the assurance
run its proper course.
But as to the question of sending double notices—
first of the policy's date of annual expiry, and again
after the thirty days of grace have expired, it must be
obvious to every thoughtful mind that the labour and
cost and responsibility of this are enormous, and that
in no other department of business would it for a
moment be contemplated.
If assurance offices, having from 6,000 to 20,000
policy-holders, were to undertake such a duty, it
simply amounts to their undertaking to manage the
affairs of their clients in addition to managing their
own. No company grudges the sending out of a re-
newal notice; but if that is neglected, it is utterly un-
reasonable to ask that further warnings be given.
On the other hand, I believe that most of our assur-
ance offices would be ready to give heed to any fair
explanation of a failure to pay the renewal premium
having arisen from exceptionally untoward accident;
only they would require, and be entitled to, a
medical examination, or a declaration by the party
assured that he has had no failure of health since
the date of the premium having become due; for
it is obvious enough that a fraud might readily be
committed by a policy-holder who had deliberately
decided not to renew his policy, but who, on some
symptom of failing health, changed his mind and
resolved to pay his premium, long after it was due, on
some plea of forgetfulness or remissness.
I greatly doubt if the real grievances in connection
Nith this whole question are so numerous as to call
for any interference with the existing practice as to
notices of renewal.—l am, &c.,
A POLICY-HOLDER IN FOUR OFFICES.
Edinburgh, Jan. 21.