The Portland daily press., 1873-02-24
Insurance Legislation.

committee on Mercantile Affairs and Insur-
ance have reported bill amending chapter 40,
Revised Statutes, in some important particu-
| lars. Among the amendments proposed is one
compelling all life insurance companies issuing
policies in this State to pay a surrender value
whenever the policy holder becomes unable to
continue his payments, after certain number
have been paid. 1t seems that the agents of
one or two companies issuing 'Tontine poll
cles' have been to members of the committee
and have really made the members believe that
they were duped, and that they had reported a
bill which win drive life insurance companies
out of the State. 1t is said that the General
Agent of one of these companies, who is re-
ported to be at work on salary of $4,000
| year, has made such an impression upon the
members of the committee and the Senate by
statements which viii not stand investigation,
that the Senate, Saturday, passed the bill with
the non-forfeiture sections struck out As these
sections were put into the bill at the suggestion
OF some of the best lawyers il the Sase, that
zsSssay VIII undoubtedly have an intelligent dis
cussion upon their merits without being influ-
enced by the personal interests of any man.
If we are correctly informed these amend
those who have deposited trust funds (for such
life insurance realyis or should be, for the ben
tit of widows and orphans) and after two full
annual payments have been made give the pol
cy holder the benefit of portion of the money
In their hands in insurance values. The oppo-.
sition to the bill comes from those particularly
interested in ''Tontine policies class of in.
surance of a very questionable character and
which is fairly represented by the following let
ter from Hon. Elizur Wright probably the
greatest insurance man in the world After re-
viewing the situation of the rich and poor he
says: i
Now, with distinct view of these two sorts
of people who take life insurance policies we
are prepared to define, understand a nd appre-
ciate, the powerfully and extensively advertis-
ed 'Tontlne Plan" 1t is a contriyance to IA
ciltate the going of the people who can 20
without rubbing, at the expense of the rub-and-a
go people Its sole and only function is to make
the richer part of the company richer by max
ing the poorer part poorer 1t does not intro
duce into the mechanism single additional
drop of lubricating oil, but it takes from the
wheels that have too little whatever they have
and applies it to those that have no lack. 1t
cunningly introduces into the body of the policy
p bet on the persistence of certain annual paw
ments, say for ten, fifteen or twenty wears
should the party live so long. This little gam
bling arrangement, where the stake in
the company's hands is the legal reserve and
the surplus is, of course a safe thing for it.
The losers are, first, those who have died in
the meantime, and second, those who have
lapsed Oh forfeited their policies The winners
are those who have surviv and kept their pol
ices IN force-sqpposlng the company pays
them what the losers have lost Superstition
that calls for certain am punt of faith The
losers who have lapsed, have lost both surplus
and reserve as they existed at the date of lapse.
This is what. without exactly knowing its
amount they bet on their ability to meet ten
fifteen or twenty annual payments. Here the
bulk of the loss is sure to fall on those least
able to bear it, and the winnings go to those
who least need them. As game of long purses
against short Ones it can hardly be said to be
far AT any rate, the avera,e effect must be
exactly the reverse of avowed object of the in
stitution 1t is as if a temperance society should
endeavOr to promote its causes by establishing
liquor saloon under its lecture room, or a
church should support its minister by lottery.
Insurance is necessarily, to certain extent,
game OF chance. Its peculiar benefit arises
out of this fact. But the hazard should be
kept at a minimum. The little appended game
called the ''Tonrine Plan, is wholly extrane-
GUS, superfuous and unnecessary. Itcould not
possibly flourish if the fools were all dead, or
nearly all. For that matter, we know that
highly gullible, but not unworthy, people so
abound, that lotteries and many other sorts of
gambling could flourish, if only legislatures
would give sufficient corporate facilities. Why
they allow their creatures who are authorized Z
to deal in life insurance to en- rap the unwary
by these Tontine Plans, might perhaps become
known to the public if the advertisements of
them were not too profitable to admit of free
discussion in the daily press. .ss t}le d.
Commissioner Paine also pronounced his con-
domination Of this system in his last annual re-
port, and we RESPECTFULLY call the attention of
the members of the Legislature before refusing
to protect the people, to both of these state
ments. Mr.. Paine says, page IS:
The fortunate holder of a prize lottery ticket,
or he who "wins the pool' at cards. may get
back his money paid and very large percent
age of excess in the way of ''protit,'' if he may
please call it so, and SO may the fortunate hold
er of 'Tontine" policy, who by his fifteen or
twenty years endurance outlives others of his
class to share all their excessive payments as
well as his own and all their lapses besides.
The one "bets" on cards, the other on his long
life.