The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1895-02-22

1NOS-eNAAS-
their high Character We have been at a good deal
OF pains to get our holdings into bonds having
long time to run.
Insurance Operations.
MORTALITY.
The death losses in 1894 were somewhat higher
IN amount and ratio than those in the previous
year. but were still far within the amount antic
pated by our premiums and reserves as to give us
net saving of about s3s50OO.
REVEALS.
A good feature of the years business was the
revival OF considerable number of policies which
lapsed IN the pressure of the panic of 1898. 1t is
far the cheapest way in which persons who still
need Insurance and still insurable risks can
resume carrying policies. Our agents are in
structed to give particular attention to such cases.
DIVIDENDS.
The dividends paid to policy holders in 1894
were larger than those paid in 1898. The cost of
their insurance was therefore less like increase
will be made in the dividends on policies renewing
| in 1895.
SURPLUS.
Notwithstanding the large dividends paid in
1894, the surplus held increased from $6,44s,-
| OPT 81 January 1, 1894, to S6,S76 2l2 70 January
l, 1895, gain of $42S 1874 81. But 1852 61S so of
this was due to the increase in the market values
OF stocks and bonds those of the previous
year. leaving gain to surplus of S166,566 II from
the actual operations of the year.
Out of this surplus must ultimately come the
difference between the par and market values of
our bonds if they held to maturity. For the
rest protects the assets and the business against
unforeseen loss and disaster, and aids materially
IN earning dividends and keeping them
steady, while each maturing policy as it retires
from the company receives its apportioned share.
Our surplus would be over 81 900 600 larger than
we count it if we tested strength by the
legal standard used by the State departments and
by other companies Computed by them our sur
plus would be about $S, 100000.
NEW BUSINESS.
We have steadily adhered to our time-honored
principle of seeking only such good, safe business
in the healthy parts OF own country only, as
could be had without increasing our expenses and
so increasing the cost of insurance So great stress
has been laid by certain companies, laborng under
certain necessities of their creation the i'm
perative need of great volume of new business
every year, and they so violently criticize those
who do not follow their lead, that not few mana
gers regard themselves justified in meeting hard
times with great expenditure rather than allow
falling off in amount at risk. An appearance of en-
terprise is to be maintained at whatever cost to
their policy holders. Dividends must not stand in
the way.
The Connecticut Mutual is so large and it's bust
stable that 1t does not need to make size or
growth matter of other than secondary import
Its first aim is to make its policies secure;
its second, TO make them cost as little as possible
through economy and prudence; and them from
without making us cut policy holders dividends, it
takes on growth in easy times and in hard times it
takes it or not may happen. Cost to the present
members is so vital matter in life insurance that
in view if that element be properly taken care
OF the matter Of growth is thing to be anxious
about 1t will take care of itself in the sense that
it needs no sacrifice of existing interests.
OUR EXPENSE ACCOUNT
In 1894 was only 9.94 per cent of the income a
ratio materially less than that Of any competitor
and much less than half that of the most pushing
companies.
The costof our insurance is correspondingly less
than in those companies. The cost of our insurance
is and for long time has been decreasing each
year, the cost of theirs is and for long time has
been increasing.
COMPETITION.
use by so many companies require extraordinary
profits to make the extraordinary dividends prom
sed in but postponed to the future. These profits
are to come from forfeitures, and great many are
needed, for large amounts, for the success OF the
plan. great business to furnish great for
FIXTURES to the pool seems to be the central idea
and aim of the scheme. 1t is the one end to which
every nerve is strained. The new business must
be kept ahead OF the forfeitures. This makes COM
petition exceedingly sharp.
For example, one New York company wrote in
1894 the enormous amount of 5000, 100000 and
over in new business But it also had lapsed and
surrendered besides its death losses and endow-
ments of about $1O,0OO,OOO the great sum of over
$156,000,G00 over 20 per cent of what it had in
force at the beginning Of the year. Several other
companies are striving to Guido If possible, or at
least equal this Its expense account is % per
cent of its income and has been high as that for
many years. Its rivals not behind in IiberaIity
of plan expenditure. 1t is useless to look for
honest, legitimate competition-an examination of
real merit-under such conditions The business is
solicited upon cunningly devised plans, upon de-
ceptive estimates of profitable investment" which
have never been fulfilled, and is usually secured
by heavy rebate on the premium. Who ever
pays one OF these companies any large part of his
first years premium is probably being discrim-
mated against by the agent
Under these conditions the Connecticut Mutual |
still offers plain life insurance as protection to the
family, and tries to make it attractive simply by
making it perfect to that end and by keeping its |
cost down TO the lowest possible point 1t tries to
realize the ideal results of legitimate business
and it seeks attract its membership only those
who want only such results and do want spec
ulation their familys protection. And it does |
try TO make think he is getting his in
surance cheaper than any other man. or at the ex-
pense of any else, at less than its true cost.
INVESTMENT INSURANCE"
But plain life insurance has contest the field |
with the so-caled investment Insurance." AS If |
anything like investment" could come out of
companies that take from fifteen to twenty-five |
cents for expenses out of every dollar that comes
in. The lack of foundation is concealed from ord-
nary eyes by arrangement to postpone all divi-
dends for ten or twenty years-the longer the time
the higher the commission to the agent and the |
rebate to the applicant. Whoever dies leaves be- |