The morning news. [volume] (Savannah, Ga.) 1887-1900, 1897-02-25

conditions having their origin largely in
those questions which became the issues
in a political campaign which, for the
critical gravity Of the results involved
and the intensity of feeling engendered,
| has had no parallel in our history.
IN such a year enterprise loses much of
| its usual reward, and the best results in
| nearly any business are those accom-
| plished at least cost while maintaining
| the efficiency of the working machinery
and waiting such favorable change as
will allow a satisfactory amount Of bust
ness to be done at usual cost and without
strain.
Effect on business.
Especially is this true in the business
of life insurance. Its cost is usually reck-
oned as a part OF ones expenses; and
when money is hard TO come at and profits
are little, and perhaps nothing, new ex-
penses are not readily undertaken, the
usual ones are often curtailed and bust
ness shrinks. Under such conditions a
large volume of new business can be
maintained in only one way; by such con-
cessiOns on the first premium as tempt
a new insurer to take a policy which costs
him little or nothing the first year, and
which he gets at the expense of the older
policy-holders whose money has to make
up. the deficiency caused by what the
new blood" costs but fails to pay.
Were any given quantity of new bust
ness in any one year necessary TO the sta
bility of q company--as ii might be were
the company new and its amount at risk
as yet too small for a safe average expert
ence-there might be a reason for keep
ing up pace even at increased cost, If
the business so gotten were likely to stay
by. But there Is no company of our class
doing business to-day in any such situa-
ton; nor any which cannot afford to let
its new business vary with the conditions
affecting the volume of every other bust
ness, except those which have attached
to the simple methods of legitimate life
insurance certain wholly eXtraneous
features which create necessities of their
own and dominate the situation. The
accumulated dividend" companies, some
of which are losing Sl25, 100000 and upward
of old business every year, and must keep
a very great amount of business going in
order to keep up the lapses and forfeit
ures necessary to provide their "accu-
INFLATED surplus" or tontine fund, have
tried to educate the public to believe that
a great new business and a great
amount at risk" were the true measures
of success, and may feel that their choice
lies between keeping up the inflow at any
cost, by any effective means, and such
shrinkage as they cannot contemplate
with equanimity. However that may be.
the vicious and costly methods of compe-
tition are continued.
An Ideal Position.
The Connecticut Mutual is happily under
the stress of no circumstances, natural or
artificial, requiring it to force its business
beyond the conditions of the time. It's
position is ideal, and that to which every
company ought to strive to attain, bust
ness so large as to give absolute stability
in Its average experience, yet not so large
don Fuf ~ fasnn
ditions it can be maintained without diff
Guilty, even allowing for occasional and
considerable shrinkages in bad times,
standard of soivency beyond question, in
vestments worthy such trust, and an eX-
pense account so small as to give the
largest possible saving to policy-holders
and so adjusted that, whether its business
increases or shrinl1s, it will not have to cut
its dividends on that account.
That is the position we occupy. SO far
as the absolute safety of every present
policy holder is concerned, or so far as his
future dividends would be affected 1t is not
necessary that we should ever write an
other new policy. The company would
pay out to the very last man and maintain
the same relative high dividends without
it. The only reason for taking new bust
ness is that we may give to new tamllles
the same secure and cheap protection that
those of our present members are getting
The latter have no need whatever for any
new business. And, therefore, 1t is that
among all the struggles for first place as
to new business and amount at risk among
the large companies, and those of the
smaller ones to keep somewhere in the
race, the Connecticut Mutual has steadily
refused to compete for new business at the
cost of present policy-holderss What we
can get without reducing their dividends
we take what we can't goes to those
whose inducements to agents, and whose
| speculative proposals and momentary
temptations to new men are great, but
whose dividends to old members are small
err In good times we more or less enlarge
our business. In hard times we husband
our strength, Indifferent to all considera-
lions except maintaining our standard of
| excellence.
We are thus explicit, not only because
the matter is apt to these times, but also
because in the competition of business, 1t
is commonly represented by those whose
only point of comparison with US is in re-
spect of new business and amount at risk
that ii is undesirable to insure in COM
pany which is not rapidly increasing its
| business; that expenses would be less, div
| idends larger, and security greater if We
were pushing harder for new business and
getting more of Il; a statement which is
false in every aspect and particular. There
must come a point with every company,
no matter how rapid its present growth,
beyond which II cannot force an increase
of size And several of the largest COM
panies are rapidly approaching that point
What will be their status then? Should
the public, therefore, turn from them? II
| they will be then undesirable companies,
why should they be butt up at all?
If a company be truly desirable, prosper
Gus, and safe only while and only as IL is
| increasing it's risks. then the more rapidly
company is growing to-day the faster
II is approaching the time when it will be
no longer desirable, prosperous, or safe. If
that be so. life insurance should be sum-
marily suppressed as an inevitable swindle
But, as our expense rate is less than
that of any other company, and only about
| half that of the great pushers, while our
results to policy-holders are very much
| larger than theirs. and our stability great
! er and more conservatlvely based, the ad-
vantage to be derived from following their
example would seem more than doubtful
| especially in view of the heavy and contln-
uous reductions they have made and are
still making In their dividends. while we
| have maintained our scale. The reproach
of such a conservatism we are very con-
tent 10 bear. The vigor Of the oak is Of
| an enduring sort.