Watertown republican. [volume] (Watertown, Wis.) 1860-1906, 1870-06-15
Life Insurance

Last week We gave an illustrated deScrip-
ton of the elegant and substantial Insur-
apce Building recently completed by the
Northwestern Mutual Life Insurance Com
pany, at Milwaukee. This building, almost
entirely constructed of imperishabIe and
fire-proof material, is typical of the financial
basis and structure of the institution that
is to occupy it. Such building will stand
long after the last policy holders of the
3d. 900 in force shall have passed away.
The Northwestern has recently adopted
for its premium reserves, Tor the amount
necessary to separate and keep invested to
pay the policies whenever they NAV become
claims) the legal standard in the state of
Massachusetts,, viz: the combined expert
eBce' or 'Actuarjes" rate of mortality at four
per cent interest. THIS IS THE HIGHEST
STANDARD OF RESERVE KNOWN 10 ANY ANERI-
CAN COMPANY, and places the COMPANY
upon an impregnable basis of solidity and
security. A lower reserve, that is assum-
ing a higher rate of interest for reserves,
gives temporarily larger apparent surplus
for dividend.
We feel it our duty to commend this &C
ton Of the company in the direction of
security, because there has been growing
up III this country among life companies
practice OF too low reserve standard, in
duced by q desire to win business. AS
policy holder, we certainly prefer a standard
of reserve shall be adopted that will make
the payment of our policy absolutely GER
tain, rather than have dividends made out
Of funds that should be held in reserve.
1t has always been a mystery to us how the
public can be deceived INTO believing there
can be any security either in life or fire in
surance without cost This new basis of
reserve of the Northwestern, as we under
stand it, makes no difference in the aggre-
gate earnings Of the policies. It simply
/ distributes those earnings in different
amounts over the life of policy.
| It is the highest evidence of financial
strength and solidity, that the Northwest
ern has been able to make the change from
a five per cent. to a four per cent. reserve,
and still has in hand 500, 600 to be divided
in January, 1871.
| The Northwestern has the sanction of the
best authority in the country for this change
IN their financial policy. The Western In
sarTd12ce ReUieoo, st. Louis, endorses it:
But the most conmendable feature in the man.
agement OF this truly sound and vigorous Insttu-
ton, gather from a circular now before u.s. is
sued by the officers of this Company in which it is
| announced that On the 18th day of March, 1870,
they adopted the standard of their reserve. the
highestaule known to any American company, to-
wit: The combined experience rate of mortality,
at four per cent interest, thus placing the North
western on an impregnable basis Of solidity and
security.
! We congratulate the officers of this company and
thank them too, for thus taking the initiative in
| this much needed reform We have long been sat-
isfied that the New York rule of reserve, AZ per
cent? is wrong, as basis of ultimate security, and
in common with other Insurance journals, in the
country have insisted that the higher rule is the
| rule of absolute safety
The american Builder says:
We heartily commend this action of the North
jority, not only Of its policy holders, but of the
mass OF the people.
The Chicago Advance concludes a long
article thus:
| Let all or companies follow the example of the
| Northwestern and shall never be compelled to
/ submit to the disgrace which our English friends
sustained in the great ''Albert Edward fasco.
We copy the annexed from the Chicago
Tribune:
Life Insurance Company have to be abund-
anty satisfied with the wise course pursued by the
officers Of the company during the past year, and
the prosperity attained IN the past and assured in
the future The assets amount to nearly seven
and quarter million dollars, and the company has
adopted 4-per cent reserve, giving an impregna-
bic security for the payment of all policies they
become claims This is the highest standard of re
serve known to any American company, being
the legal standard in Massachusetts, and recon-
mended by the most eminent actuaries, The sur
plus all going to the policy-holders 1.-THE company
being purely mutual) the dminuton of dividend
is only apparent, the aggregate dividends being
really larger and the polcy-holders who uuder-
stand the merits of the case have the satisfaction
of knowing that they are absolutely safe-which
should be the leading consideration with insurers
The Hon. Eizar Wright, in a recent ar
ticle, thus speaks on this important topic
but a vast company of co-insurers spread over
a continent and binding together the present with
future ages, should not be content with bare suf-
hciency Of reserve. 1t should keep barrier of re-
serve between and future insolvency. ever on the
increase and as impregnable Gibralter The
most satisfactory working will be obtained by a
standard of reserve which will not only keep the
old business Ch0JEy above the necessity Of acquiring
el0 but Will make it for the interest of bust
ness to seek the company in preference to any
| company that can be presented
The Northeastern entered upon the year
1870 with the most fattering prospects, and
with assets at the present date of 81, $50 000
Nothing in the history of the states of the
northwest has so nearly paralleled their
material growth as this great financial, sue
cess-the Northwestern Mutual Life Insur-
ance Company.