, 1877-03-25

| N1r. FRANKLIN stated that in 1876 ther,
were 1000 policies which lapsed. Abou
800 of these were by death, and !, ZOO wer'
forfeited by non-payment Of premiums Ths
| average of these policies was Tor 81, 900, ane
| the average time for which premiums hni
been paid was six years. Here, then, is
| statement Of the character of the business
done by one Of the best of lfe-insurance
companies. The new policies about equaled
the number 1apsed, and the average, life ot
those which lapsed was six years, and the
number lapsed BY death was 800. The result
of this system Of business is, that, Of the
number of persons who take policies of life.
insurance, u per cent die while insured, and
o21 per cent pay premiums Elk years and then
abandon the policies. When it is understood
HAT the ayowed object of ife-insurance
is to pay to the survivors Of the insured q
certain sum Of money at his death, the act
uni fact that less than eight persons out of
every 100 insured ever receive anything
shows how far the real business of life-insur-
ahce las departed from the popular idea.
In view Of this remarkable disclosure, oil the
romance and poetry of life-insurance be-
comes very practical and mean reality.
The present practice is to send ont agents to
importune uniformed persons into taking
policies. For this duty the importunate can
vassers are paid heavily out of the proceeds
Of the work, the company feeling able to do
SO, because, out of all the insured, q per
cant only are loss, and 92t per cent are
profit. We repeat these figures that persons
who have life~insurance may understand
what small figure the sums eventually to be
paid on their policies cut in the business of
the company. AS the life Of an insurance
policy averages about SIX years only, the
policy of the company is to get all the
money possible out Of the insured in that
time; the short life Of the policy reduces
the loss BY death Of the insured to less
than eight policies out Of every hundred,
while the six years receipts of premium
from the other ninety-two policies are swept
into the Treasury Of the company. As the
President Of the New York Life stated, find
ing that the mortality Of the insured at the
South was greater than Mt the North, because
the proportion Of policies net forfeited was
greater, that Company has had agents in that
section purchasing the policies for cash. The
end of life-insurance, therefore, is not to en-
courage insurance payable at death, but to
encourage insurance to be terminated by for
felture before the death of the Insured.
Nevertheless, premiums on life-insurance
are estimated according to the average rates
Of mortality or perhaps Of longevity, and
such rate Of insurance is exacted as would |
Justify the payment of al policies at the |
death OF the insured. Tho result is immense |
profits, which are largely distributed in sal |
aries and fees, in costly buildings, in daring
'1sks and speculations, with an ever
present temptation for fraud Life-insur.
ance, honestly and economically managed,
'arrled on for the benefit and interest of the
insured, could, we suppose, be cnrried on
'rofitably for one-half the rates now exactcd.
md when Ife-insurance companies shall re-
rench their expenditures and offer insurance
t lower rates, giving to the insured the ben
1t OF at jeast so per cent of the present
expenditures, there will be q revolution in
he present mode of doing business, and life
asuranco will cease to be, as it now is in
'any companies, snare to get half dozen
nnual premiums out OF each OF its CUSTOM
rs, and then forfeit the policies.