Martinsburg herald. [volume] (Martinsburg, W. Va.) 1881-1920, 1895-05-04
ASSESSMENT LIFE INSURANCE.

ASSESSMENT LIFE INSURANCE.
The attention ofthe public is agar
called to the assessment system
life insurance, and it would seem as
though within the last few years the
fallacies in the plan will become gen
orally recognized. Specifically con
sidered, the assessment method seems
quite plausible, but experience has
demonstrated that it is very uncertain
both as to cost and ultimate results.
As the assessment association grows
older the death rate increases and the
assessments become heavier. The
advocates. Of assessment insurance ar
cue to intending insurers that the
death rate will be kept at normal
percentage by the admission Of new
members, but the actual experience
of prominent assessment concerns re-
flutes the assertion
1t will be easily seen that if an as
ISOLATION had FIVE thousand members
in April, 1894, each OF the survivors
is one year older in April 1895; 50
that to keep the death rate at the
same figure there would be required
an influx OF nearly five thousand men
year younger than the average,
twenty-five hundred two years young
er, or one thousand five years youug-
er. Such an increase the concern is
not likely to secure, and when the
need Of yonng blood is made apparent
by heavier assessments. even the
young already enrolled commence to
drop out This is quite natural, as
they can easily replace their Insurance
elsewhere.
The rates charged by nearly all Of
the assessment concerns are ineduit-
ably fixed. Some Of them in ADJUST
ing assessments for various ages take
the age at date Of entrance and charge
upon that basis throughout the con-
tinuance of the insurance. Thus a
man of, say, thirty-three, now enter
ing, pays as much as man of iorty-
Three who Joined in 1885. In about
all of these concerns the old lives
gain a decided advantage over the
young, and in too many instances
the absence of proper medical exani-
nation results in permitting impaired
risks or thosewith hereditary hazards
to come in, which OF course will iu-
crease the cost for those having the
normal expectation Of life.
Another great objection to assess
ment insurance is the frequency with
which such organizations resist death
claims on technical grounds. and fin
ally force compromises. Even when
the association is Differed BY honest
men who endeavor to meet its obliga-
tons it is frequently unable to pay
promptly, because Of the time needed
to collect the assessments and some
times. when members ignore the call,
is not in a position to make more
than a partial settlement. The class
of people who live from hand to
mouth, and whose longevity is not
promoted by modern convenience,
sanitary plumbing, frst-elass medical
attendance, etc. is more literally re-
presented in the assessment concerns
than in the regular life companies
and hence the mortality Of this class
is likely to be greater and lapses
much heavier. This is quite natural
as the best lives seek the best COM
panies, just as the most responsible
business men deposit in the strongest
banks.
In a we'll selected old-line life COM
pauy an insurer knows just what
must be paid each year. and will not
receive demand at an unusual and
perhaps inopportune, time Tor sum
he can i'll afford to spend. BY certain
forms of policies he can, II living at
the end Of twenty years, get back
what he has paid in, or. II dying dur
ing that time. his beneficiary has re-
ceived the sum for which he was in
sured. The member Of an assessment
concern does not have any positive
knowledge as to what his insurance
will cost him. when he will be obiig-
edto pay and, finally. whetherhis wild
ow will get all Of the promised SIM,
half OF it, or anything whatever. lie
also has the disagreeable fact staring
him in the face. that when IFS stand
ing is publicly questioned members arc
likely to default On assessments and
thus bankrupt the concern. IN. y
Journal OF Commerce aud Commercial
Bulletin.