Fairhaven herald. [volume] (Fairhaven, Wash.) 1890-????, 1891-08-27
LIFE INSURANCE

The act of insuring ones life is
nothing more nor less than the estab-
lishment of a deposit of savings, with
the uncertain element of the duration
of the depositor's active existence in
favor of the insured, and his ability to
save the policy from forfeiture, in
favor of the insurer. 1t is game of
hazard with the chances on the bank
er's side. In the first place, only good
lives" are taken. That is, a healthy
subject is chosen, who, under well as
certained hygienic laws, will live long
enough to pay annual premiums, which
will have protected the company in
actual amount, and made a profitable
return by way of interest on invest
ments. The insured, in the ordinary
course of commerce and rustling
trade, might have used the amount
paid, in the time covered, to vastly
greater advantage; but, in the mean
time, his heirs and successors stand to
be benefited by any fatality which he
may suffer. So, as far as the chances
20, il is a fair transaction, and life in
surance is elevated from the lower
level Of gambling, to the higher one
of legitimate business.
The opportunities for fraud which
the business affords have melted
legislation TO protect the policy
holder; and, among other wise provis-
ions, is the requirement that COM
panies not organized, chartered and
having their headquarters in the state,
must deposit within the state sum
of money large enough TO compel the
insurers to carry out their contracts.
Stock companies of the magnitude of
the prominent English, Connecticut
and New York concerns have no diff
Guilty in complying with the stipula-
lions; but mutual companies find
themselves shut out of the field. The
stock companies have annual revenues
, in premiums and returns from invest
ments, and are thus in a position tC
place enormous sums of money, or pay
policies matured by death or tontint
termination on demand. The mutua
companies, whose revenue is naturally
, restricted to assessments to NEE
emergencies, cannot, in the ordinar!
course of business, command sucl
cash in hand as is necessary to compl.
with the deposit demands Of tn
numerous states requiring such secu
rity as a preliminary to transactini
business.
Now the question occurs Is the dis
elimination and exclusion implied
= fair thing for insurers or mutual CON
panies? There are thousands of me
e who prefer the mutual system, becaus
of the less annual cost per thousan
, dollars of insurance. The mutua
( company can do business vastl
} cheaper than the stock; and, thong
possibly not so secure, yet 1t has it
I attractions, and to deny an honorabl
' mutual company, whose record an
r management are unimpeachable, az
: mission to the state, because 1T ca
not and should not have capits
); enough to comply with the statutor
D provisions of deposit is both ungenel
: Gus and unjust. AS 1t stands, it seem
I that the Washington state law exclude
: mutual companies chartered in othe
states. and the next legislature shoul
9 take steps to so modify the law as
!, allow solid and Trustworthy compani,
I to come in on a different basis frol
l. that in vogue; yet stringent enough
5 protect the insured.
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