Telegram-herald., 1891-11-28
MUTUAL RESERVE INSURANCE.
An Istsrsssisx Chat with tuperiatss
deat Ludwig

An Istsrsssisx Chat with Supsrintss-
dess Ludwig.
N. s. Ludwig, superintendent Of the
Mutual Reserye Fund Lie assec alton
OF New YORK, MAS seen At the Morton
last night by reporter for the TELE-
GRAM-HEsALp. In conversation IN re-
gard to life insurance matters, he said:
I'VE dItfer from assessment companies
in that We have established rates based
upon experienced tables oil mortali'y
aud also reserve and an expense
fund. As an illustration--at the age
OF 40, We would charge about $l6. OF
TINS 5000 would belong to the mortal
ity fund. $3.50 to the reserve fund, and
81 to the expense fund. Ii the death
rate exceed the mortality fund, the de-
ficit is made up from the reserve fund.
Our mortality estimates are trlfie
higher than the estimates OF the Old
line companies. The Mutual Reserve
has paid $i2 200, 900 in death claims.
and the reserve fund exceeds $3.i55.-
coo. The interest on this fund reverts
10 the death fund. BY . COMPARISON OF
insurance companies, We have
ItdoOu W OCitVNC Su-S iafS
OF entry can be maintained a. long
as the insurance exists upon the
members. Asinsurancc 10 protective IN
its nature, we claim that when a menu
Der has contributed for ten years, II has
been ample to give the necessary pro-
lection. Thereafter the reserve will be
credited to him, and instead OF paying
Sl6.20 he would pay Sl2.40. BY leading
ka h,,tr al, al
as tnc typical life insurance company,
b cause It c0ntides itself strictly to life
insurance and does not ask dollar
more than is necessary for tie protec-
ton of its members. 1t has been ex-
amined by expert accountants IN the
United States and Europe, aud has re-
ceived their unqualified endorsement.
Every charge made against 1t has
proved untrue. 1t has contested fewer
claims than any other company in the
United States Of the same magnitude;
and in no case has it ever contested q
claim unless evidence ct fraud was
plainly vlsibls on the face OF it.
In reference TO the transfer OF the
Masonic Mutual Of western Michigan,
there has existed an erroneous impres-
81 n IN the minds OF some. As under.
| stand it, the trustees OF the Masonic
MuluGi became convinced that some
tang mad to be done; and . committee
went to New York 10 examine the Mu-
tual reserve and see il satisfactory ar
arrangements could be made for The Mu-
tuar Reserve to assume the risks OF the
Masonic Mutual. From their inveeti-
cations and the generai terms n under.
stood, the committee were Satisfied that
the Mutual Reserve, III things being
taken into consideration, could amply
| protect It's members.
"Why is IL that 30 many assessment
| companies have quit the bnsiness?'
asked the reporter. "There has been
great deal of unjust criticism made
upon the cooperative assessm mt sys-
| tenn. The aim of these was to give their
members insurance at the lowest posi-
4! bic cost. regardless OF the elements
4, necessary to make IT absolute. They
| 90 not charge q cent Tor assuming
risks until death actually occurs. As 3
result the death rate for the iirst few
| years 10 very normal. The members
do not seem to realize the expense.
! But no provision is made to offset the
death rate except 10 increase the as-
sessments. As result when these are
increased, it tends TO lessen the charac
ter of risks which tend to keep the IN
surance at its normal rate, that Is, the
younger class of members. They make
no provisions for conducting the busi.
ness on business principles. The mo-
ment risk 10 assumed it represents an
actual cost-if not at the present time,
then at some future time. Ignoring
this fact il the chief cause why SO many
cooperative assessment companies
have 70 CEASE dong business. 1t is un'
just to state that they fail. No concern
fails unless there 10 = lose, aud il the
cooperative assessment company has
honestly distributed it, assessments
each member has had value received
A failure can exist only when funds
haye been collected over and above
what 10 necessary to do business"