New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1873-08-23
PROGRESS IN LIFE INSURANCE.


THE EQUITABLE LIFE AND THE MUTUAL.
| To the Editor Of The Tribune.
SIR: An advertisement has lately been in
serted in several of our leading newspapers the intent
Of which is chiefly Djure the Equitable Life Assur-
ance Society.
InasInuch as reference made to the last report Of
the Company az its Actuary feel it my duty to notice
IT, The advertisement, commencing with some general
remarks on life Insurance. enters into comparison
OF the mutual and joint stock systems, much TO the
advantage Of the former, and then goes on to com
parison Of results, taking the Mutual Life Insurance
Company OF this city as an example OF the mutual
system. and the Equitable Life example OF the
Joint stock system making it appear by necessary imp
cation that the Equitable is subject to all the evils which
have us been asserted belong the joint stock class
OF companies.
In reply be stated that in the year 1853
the Legislature their WISDOM and after experience OF
dangers attending the simple mutual system. passed
law that no new life insurance company should be
started without first deposting with the State 100000
. guaranty for their policies THIS in effect prevented
the formation thereafter OF any purely mutual company
and no company has been founded since in the State
without stock capital.
When the Equitable Society was founded this law was
in force and its promoters had 10 raise the amount
named by state by OF stock captal but, 10
make it clear that profit on their stock was not their
motive in starting the Company they adopted the prn
cipe in their Charters principle not adopted by
company previously formed, and by very few formed
since-that the dividends upon their stock, which, IN
obedience 10 the enacted wisdom Of the State, they
pledged as q guaran OF their good faith should draw
legal interest only (which By investment 1t reproduces
thus cutting themselves of from any large dividends
thereafter and securing to the polcy-holders all the
benefits that could arise from the mutual system with
the added advantages OF outside amount pledged for
their security, and the prudent management OF the
Society.
In respect 20 the numerical comparison made In the
advertisement IL is TO be remembered that ratios OF IN
come and expenditure affected very materially by
the comparative business and other crcum-
stances the two companies compared The Equitable
Society has for several past done more new bus
ness than any other life company in the world and its
expenses should be larger comparatively than those OF
other companies whose new business bears much less
proportion to their old But be remembered that
while large new expensive IN the obtaining,
II forms the foundation for substantial growth ana
permanent reduction Of expenses in the future Inc
Equitable is less half old the Mutual Le anu
brief comparison between its present state ana 'ne
state Of the Mutual at the same age Will perhaps sno"
mUre clearly the relative OF the Two compaes
and give slight glimmering OF what VIII DC 'nc coh
ton OF the Equitable when 1t has attained the present
age the Mutual Let consider the stahuins
and results Of the two companies wheh e"oh DAu 'A
in operation about thirteen years
Total annual premiums after 18TH -,o 4, toc seo
~ ,o,i . IsiIg g9J,lSJ
Total income alter 18th year, 9oo'sio 800 ,s
Assets after 18th year no ss@ otT
Amount at risk.-.
Again the ratio Of expenditure death and expenses
10 total income for the first is years OF the Mutual was
.o27 Dor cent while the Equitable foE ID years ana