The National tribune., 1885-05-21
L.apses.
Additions to Total Tontine
Tontine Pool. Pool.
Sl22,693,JO5

Here, again, are suggested practical questions
for those interested; for example, if the lapse
of $S050, SO in 1879 and the surplus of interest
and margin on Tontine premiums produced
s742,0 ,055 for the POOL why, in 1852 did the lapse
of 1882 l05, the surplus interest on a larger
reserve and the margin of larger volume Of
premium produce only S2J3,695 for the pool
II they could add but S253695 in 1882 how
could they add Sl,2ol,96S in 1884? and vice
versa. How are matters apportioned?
In 10 years the Equitable has lost by lapses
$122, ,693, sos of insurance and added $5.40S. SCI
to its Tontne pools, which now aggregate &c.
40S, ,S61.
MILLIONS GoNE-wHERE?
The New York Lila and Equitable together
have lost by lapse in 10 years S19l ,So3 l25, the
greater part of which was TOntine insurance,
and have added $3.50 100 to their Tontine
pools, which aggregate S9.0i2,658. How many
millions of pad-up insurance, lost by how
many thousand families, have gone to swell
that enormous aggregate2 Upon how many
tens of thousands Of widows and fatherless
children has that "judicious penalty" of for
feiture of their paid-up protection been i'm
posed? What was the accumulation of reserve
and surplus OH the Sl9l .S53. l25 of lapses for
feited to reward the pcrsistoncy of others? :?
How much paid-up insurance would it have
bought?
The comraries give no information But by
analyzing their estimates" of Tontne results
furnished for the guidance OF their agents in
soliciting this business we can get at the
equivalent of their calculations, if not their
precise form.
The Equitable, for example authorizes its
agents to "estifiate that If a man aged 80
takes an annual premium life policy Tor $4,000
i'm 20-ycar TOfitine class. persistence to the
end would be rewarded by "a cash value of
s., 100 If the company should have for 20
years the same expenses and interest as Tor the
last 10, and should experience no more than so
per cent of It's expected mortality, it would be
able to accumulate for him out of his own pre-
miums only 4.I35, so tiht it has to get for him
81, ,9S2 or about AZ per cent. of the whole sum-
and an addition of ~ per cent. to his own
proper earnings osit of the forfeiture of other
peoples reserve and surplus.
FAMILIES DEFRAUDEp.
Let US see what this means as to those other
people. Take 10000 men, all at age 80, each
insured for $4,000 by annual premium life
policies in a 2O-year Tontine class; that would
make lust $l00,OOO,0O0 of insurance to Start
with The Equitable's estimate" is that each
Of these men who lived and paid through that
period would receive 81, l20 for the surrender
of his policy. Taking the same rate of ex-
penses and interest that that company has had
for the last 10 years, and sunposing its actual
losses to be only so per cent. OF those expected
ia very favorable suppositiOn to the company
and grading the lapses according to the COM
mon experience of companies as to the period
when most lapses ar to be expected. and the
statements of the Tontine companies as to the
persistencv of this kind Of bu ,iness, and their
estimated" result would require the equiva-
lent in 20 years of G,s52 apscs, for $6S, $4,000