, 1873-08-26
EQUITABLE LlFE.hSsuRAECE SOCIETY.

To khs Editor qf 7Aa Chicago Tribune:
An advertisement has lately been inserted In
aeyora Of our leading newspapers, the intent OF
which is chioay to iniure tho Equitable Lifc-As-
a,1ranco Society.
Inasmuch az reference is made to tho last re-
port Of the Company, as ts Actuary feul 1t my
duty to notice it. Tho advertisement, COM
mencing with 8omo general remarks on Hfe-in-
Burance, soon outcrs into comparison Of the
mutual pnu joint stock syRtoms, much to the ad-
vantage Of tho former, aul taon goes on ton CONF
yAfison Of results taking tho Mutual Life-In-
euranco Company Of this city az MI example OF
the mutual system, and tle Equitable Lilo as an
example Of tho joint stock system making 1t
appear by necessary implication that tho Eqnita-
ble ia subject to all tile evila which layo just
been asserted to belong to tho joint stock class
Of companies.
In reply to this, 1t nlay 10 stated TINT In the
yenr 1858, the Legislature, IN their wisdom, aud
utter experience Of dangers attending tho simple
mutual System, passed law that no new lHe-in-
surance company should 10 started without flrrt
depositug with the State 91u0, 900 as guarantee
for their policiea. This In object prevented tho
formation thereafter Of any. purely mutual COM
pany, and no company has boon founded sinco,
IN tho State, without stock capital.
When tho Equitable Society was founded,
this law was In force, aud its promoters bud to
ra'so TIE amount named By tho State BY meens
motiyo in starting tic Company, they
adopted tho principle in thoir chastol
prnsRe sRZos1 not so sdoPsdd PPsd v b ysv is s1y
formed slnco-thnt tho dividends upon their
stock, which, In obedience to tho onauted wig
| dom Of the State, they pledged as guarantoo
Of their good faith, should draw 1egl interost
only (whioh by Investment 1t roproduces),. thus
cutting themselves Of from any iarge diyidondas
thereafter, and securing to Tho poloy-holders oil
the benefits that could ariso from tho mutual
system, with the added advantages Of an outside
amount pledged for their security, and tho pru,
| dent management Of tho Society.
| In respect to tho numerical comparison made
| In the advertisement, it IL to DO remembered
| that ratios OF income and expenditure aro at
feoted worry materially by the comparative age
extent Of businesH, aud othor circumstances o1
the two companies compared. The Equitable
Society has for several years past done mort
new busnesH tlnn any other lifo company iE
the world, aud lts expenses should bo larger
comparatively, than thoae Of other companies
tion to their old. But 1t il to bo remembered
that, while q largo now buBinoBB III expensive IL
tho obtaining, 1t forms tho foundation OF sub
| stRntin1 growth, and q permanent reduction O.
than half as old az the Mutual Iife, and brio
comparison between itH preBont Htato and th
state Of tho Mutual at tho bauoRgo will parhap
show more coarly tic relative s,,cooBa Of tho tw
oompanies, and give slight gllmmorlnG Of wha
will DO tho condition Of the Equitable whom
has attained tho present mature ago OF tho Mu
tual Lot .ls CONSIDER tho standing and roHl1lts
tho two companieB when oach had boon III opcr
alton about thirteen yoars:
Mutual. Eq.ttaolt
1Gts ls;h 'Sa:'.. p:sius e'''i e!s
Interest after 13h ycar....., III ti9i w, dt u
Total incon!e after 18th year. s9oale B,a2ooa
Aases after 1ath year.... s,a1h"is 1va "a
Amount at risk. .......... ~, ,v0a,llo lol,eo' "a
Again. tho ratio Of expenditure (deAths an
oxpensoB) to total lnco'no for tho tirBt Aftoo
years Of tho Mutual waa 1927 por cent, Will
III tho Equitable for thirteen years and tlY
months to the LIST Of JnnAary, 1879, 1t waH 3i.9
per cont, being llGoreuco Of 5.32 por cent, MI
equivalent to Swing IN expenditure OF o., 205,
02Q-the calculations haing made Oh tho rrltlc
pies adopted In tho hrtiGlo now replied to.
It may further he said that tho siatei premium
receipts OF tho Mutual, from which most OF til
ratios in tho tablo are drawn, uro not tn
amounts actually received III cash, but include
vast amount OF Hypothetical receipts, balance
by other hypothetical amounts Of oul-go in til
sflapo Of tliyldondH, 10 that an Ordinary roale
Ia deceived, and gots an iaea OF tho Gust ut doiu
tho business very different from tho truth, MI
Ill r4tios like tlloHo III tho advertisement
founded on these Hypothetical Iocoptn, IL
grossly erroneous and intended to deceive.
: u. Moreover, tho1s aro other mlstakos, somo {