New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1885-05-23
MORE ABOUT TONTINE
THE PRESIDENT OF THE CONNECTICUT
MUTUAL REVIEWS THE PARTIAL REPLY
OF THE PRESIDENT OF THE EQUITABLE. |

H. hyde President OF the Equitable Life makes partial
reply to the presentation OF the TOntne and Semi Ton
the system which have made three different times
In your columns. lie begins by lmputlng my motive for
sueh discussion to Jealousy at tho amount of new bust
ness written on the Tontine PLANS and disappointment
NJ the much smaller amount written by the Connecticut
Mutal and asserts my consequent desire to njure the
business and reputation" OF the Tontine companies
nave not assaled the credit reputation OF single
company In the slightest degree: have but stated the
facts respecting system of business which prove II to
be an unnecessary and cruel hardship to multitudes Of
families, and n public evil. And II the system be per
ncous ana this discussion establishes it's character and
enables the public to judge both It and legitimate
insurance upon their merits. upon thf truth and the
whole truth, then 1t will simply be fair to Judge my
motive for the discussion by the result of the discussion
| MOTIVES DO NOT ALTER FACTS.
Bnt neither my motive. the OF the com
panes In pushing Tontine the amount written Or
not written other systems touches in the slightest
uRce the questions have raised respecting Tontne: IL
Tontine gambling Is It perfectly needless and
ton hardship imposed upon the families Of the muttudes
who lapse their policies Does it, without the shadow
OF necessity take from the family OF the who apses
the paidup Insurance his ard surplus might buy
and ought to buy for their protection and give its price
TO pool which has not earned by any possible mathe
NAUTICAL or commercial fiction Is It taking yearly,
millions OF such pad-np insurance from such families
and putting It's price into such pool u These are the
questions OF interest to the public.
shall make further reply to Mr. Hyde's statements
respecting tine business Of the Connecticut Mutual than
that they but half truths with essential parts left
out to produce dlscredIting eject When Mr.. Hyde
wishes to discuss them squarey, the full facts, and
dares, bS OF them to mpugn by hair the
solvency or financial standing OF that company, be will
be promptly met But these matters do not affect the
merits OF rontne let not be diverted from Tonhne by
iunuendo IA 10 something else.
MR. HYpE's DEFINITION or TONTINE Examined.
Let us see how Nr Hydes reply leaves the questions
raised. lie thus defines Tontne poces They the
same In all respects ordinary policies except that all
premiums received and interest the same minus only
death losses members dying IN the meantime and the
average expense Of the company, are accumulated and
divided exclusively among those policy holders who
survive and continue to pay their premiums until the
end 81 the Tontine period at which time the surplus
ascertanei and AWARDED That IA say; the surplus
the premiums OF those who die, above the
cost OF their Insurance mp to tho time Of death; and both
the reserves and surplus OF those who lapse,
ulaed and divided exclusively" etc. What the amount
thus lost u those who die and lapse and what amount Of
pa1-up Insurance would buy for their families this
definition does not reveal But In my letter OF May 10
showed what the amount OF such loss would have 10 he
IN order u make good the estimates Of Tontno profits
which tho Equitable puts into the hands Of It's agents to
solicit rontne vita. To that exhibit Mr.. Hyde does not
make the slightest Alluson.
WHAT Mr.. HYDE DOES NOT AN swER.
IIe does deny that 20 make good his estimates"
twcn'y-yelr Tonilne, for instance, out of each
SlOJOOOOOO written there would have to beant there
tore he expects there will bo-S7O0JJO)0 OF lapses
yielding 20 the pool at least S7.5OOO00 o. cash which
might have bought and ought 10 have bought nj least
Sl7.OOOOO0 Of paldup insurance for the families Of
those who aPsed no does deny that II his company
continues indefinitely to write business at tho rate
Of a million and quarter day. the 2sth Of April,
tins writing 1850 100000 year. In order TO make
good ~ estimates" II would need TO hayoand there
fore must expect ami intend to hayea least Sal OOO
900 u hpses. yielding to the pool at least S26,OO0OOO
OF cash which might have bought and ought to have
bought for the fhiaiies OF those who larse at least
$4,000 900 Of paii-up Insurance.; no does not deny
that such a business. I'm twenty years his company
alone would having each year at least S2fl 100000
npso and would be taking therefrom for tho Tontine
pool at beast S26OOO.OOo a year In cash. whereby
would be tho families OF those lapsng 90 least
$4,000 900 year OF paidup insurance. He does not
deny that mako good his estimates he has got 70
givo who survive and continue Mt least ~ per
than their premiums can DO made to PRO
with Equitabos expenses AMI rate OF interest.
and that he get ~ per cent only out Of the
forfciurcs of ana surplus which ought to buy
aud would buy paiduE Insurance for families
These are the grand. fundamental facts OF TOntine;
these are the results necessary 70 It's "estimated'
success; these are therefore, the results deliberately
forescen, intended and arranged fori these tho
indiccs OF its character aud those who think 10 and
bencAcent that many and their families should lose
these for the benefit Of few. that the
extraordinary profit Of the few ia full Justification for tho
OF the many. that IL f. public boncnt 20 base
scheme OF speculation the knowledge that in long
period OF years q great many OF fair and even
oeient financial prospects will become financially
broken and unable TO carry tho insurance their
families need that the profits grung from such disaster
are fair profits clean money Will still like TOune and
t,fr tarl I'm ba thea fagfa gudt nair
effect and their intention have been denied; they
completely ignored by Mr. Hyde his Official uttorance
In reply Therefore does Tontlno stand confessed In
those figures; and semi ronne Il only 10 per cent OF.
MIR. nYpEs DEFENCE OF roNTINE.
Mr. Hyde makes four distinct points as the defence OF
Tontinc, or semi rOntnoi
HE GREAT PUBLIC GOOD ACCOMPLISHED BY
ToNTNE'
That by OF the greater alleged persistence
OF Tontne policies greater number remain insured and
therefore a greater amount OF protection Is given; and
that that greater persistence and to keep more
families Insured, IL Il worth while that those who lapse
should lose what they have paid In: TO put 1t In tho
language Of their estimates" II Is better that what
enhs OF their policy holders have paid over aud
above the cost OF their insurance up to the time OF ae
should be lost; that the $7OOOo0oo OF lap'es out OF
every 800 900 should lose tho S1500000 which 1t
hal paid above the actual cost % the company
for carrying $40 100000 In order that few more
may persist In paying premiums IN the nope Oh
winning part OF that S75O0ooo and that incidentally
few moro families may be insured during the Tontino
period The equivalent OF 5000 apiece OF paldup In
suranoe for 400 families is To be lost TO thom In order
that a few moro families OF the men who are after that
100000 may be insured longer than they otherwise
might DO wrong to many that unusual good may come
10 few and the few who aro after not the good oil
their families but the price OF the losses OF oher
families. Let them gamble for the S75OJOOO' because
a somewhat greater number will keep up their ihsur-
PREPosTERoUs TO PAY DIVIDENDS To THOSE"
WHO DIE EARLY.