The Indianapolis journal., 1892-02-16

amount of losses. and yet their proportion
TO the expected losses may mako them ex-
cessive-a thing they will not speak of.
great tontine company, which is rushing
in great numbers of new men In order that
they may drop out later and leave their
money behind them for the pool. and SO is
shifting it's membership rapidly and keep
ing down the average age of its insured,
may have less aggregate loss than q CON-
pany which builds mp a stable business; and
yet its losses may be far greater in proper
tion to it's expectation, and cost 1t far
more. and leave less surplus than the
greater apparent losses of the more stable
company.
The business of the Connecticut Mutual
is peculiarly stable. We do business upon
plans and by methods which promote per-
sistence. We write comparatively little
endowment business which does not keep
men In long enough to grow old. and no
policies for tontine periods. at the end of
which most men 90 out. if they have been
lucky enough to stay through.
The stability of our business is strlkingly
evidenced by these facts. Only one quarter
of it is on men under age forty-four; an
other quarter is on men from forty-four to
ffty-three; another quarter on men from
fifty three TO sixty -one. and one-quarter of
it on men over sixty-one. Aud the NOR
tality on our older ages is further below
the expectation than that on the younger
ones. We are saving more money on them
for dividends than on the younger ages.
If the safety or prosperity of life insur-
ance depended in the least degree on keep
ing the business young. it ought to be Leg
islated out of existence as wholly insecure.
NEW BUSINESS.
Our members are well aware that we are
less anxious TO gain new members rap idlv.
| or in great mum bers. than to give our pres
ent large membership the best possible re-
suits on their business. We have. there
| fore. not increased our proportion of ex-
penditure for new business-which would
| have been at the expense of present men,
bers-but we have. Notwithstanding, made
fair gain over the business of the pre-
cedipg year and made a considerable ad-
dition to the amount of business in force,
| which now amounts to Si55, ,0f3,O55. None
| of this was out for collection in the hands
| of agents when our books were closed. 1t
was all paid for.
EXPENSE ACCOUNT.
| We have practiced the wonted and ira
ditional economy of the company in every
direction; and yet have allowed no true in
terest to suffer from false economy. The
| ratio of expense of management to income
| for the year was 99S per cent; o ratio ma.
terially less than that of any other COM
| pany.
It is quite the fashion for our rivals to
| exhibit expense ratios based On the amount
| ut risk, or ON the amount of new business
| written, or some set of figures other than
| the income. But expenses do not come out
of the amount at risk, nor ont of the new
business. nor out Of anything else in the
world than the income as long as that is
large enough for expenses and other things;
failing that they come out of the assets.
| 1t is to bo regretted that the most push
| ing companies no longer publish. except in
the reports to insurance departments, such
statements of their affairs as show the
items of income and expenditure. and as
would enable the public to judge of the
cost at which they are transacting business,
| COMMISSIONS.
In the light of the revelations now being
made to the public of practices existing in
certain great companies it seems proper
to inform our members that the commissions
paid by this company for business are
strictly maintained at the conservative
standard of former years; that our con-
: tracts with AGENTS do not give them
| future control over these commissions;
when an agency ceases, the remuneration
| for the agent ceases. and such commissions
as are then fixed upon the existing busi-
| ness of that agency go to the new agent TO
| assist him In his work; we do not add to
the cost of paying men who are ct work for
us by paying also men who have worked
tor us. after they get through; we do not
submit to pay enormous commissions on
| new business in order to let an agent who
has got through working continue receiving
commissions on old business: we have no
| contracts for future commissions against
| which "advances' or "loans" or ''commuted
commissions" can be made and charged up
to the agent to make rebates" out of. or
| pay absurd commissions and brokerages
| out OF. on business which will presently
be twisted into some other liberal conf
| paDy by the same competitive measures
leaving old members to pay for the ambi-
tious exploit The resources of this COM
pany are not mortgaged to anybody.
| 1t is true that in these days of fierce en-
terprise and competition it has not been
easy for US to secure agents against the tre-
meDdous temptations held ont by the
racers" But We have been and are slowly
getting men who believe, with Us. that
success IN life insurance means and can
only mean giving pure and absolute pro-
lection to families at its lowest possible
cost; and that competitive methods worthy
of a lottery scheme are poor credentials for
q company asking men to commit to it the
| most sacred of secular trusts.
| So the agents we have and get are true
men. and the business they get stays. and
pays
| SUCCESS.
| Insurance is indemnity against loss 1t
is and can be made nothing else. To give
| perfect indemnity at the lowest true cost is
perfect success; not q brilliant success nor
| one gratifying to an ambitious manager"
perhaps. but 1t is the only success there is
in the matter and anything else that is
| substituted for it, however brilliantly it
may succeed for the time being. and until
N has worked itsslf out will ultimately