Barbour County index. [volume] (Medicine Lodge, Kan.) 1880-current, 1898-01-05
ONE OF THE NEEDS.

What the noble band of over 2,O00,-
600 men who are marching under the
banners of American Fraternal Bene
fetal Orders probably most need, is to
/ be convinced of the necessity for the
requiring of them, payments such as
are now known to be requisite to en-
able the Orders to carry out their con-
tracts or promises.
Hence, is it not well, through the
| Fraterna1 Order Press, to educate the
members of every Order to the fact
that the death losses in Fraterna1
Organization, will inevitably be at the
| same rate as in any other class of life
insurance organization and that it is
essential for the perpetuity of the
order that these death losses be met
by payments from members that are
both adequate and equitable? While
no saving can be expected in the
| mortality element, nevertheless the
cost to members of such orders will
be much less than under other systems
because the expense and reserve fac
tors will be very much less.
TO DEMONSTRATE OUR MEANING.
Let us for a little while consider
this subject from an every day stand
point, emitting scientific calculation
and application, all technical phrases
and abstruse problems. A man aged
Is has probability of life" (not ex-
pectancy) of 40 years. Ia other words,
he will probably live to be 65 years
old.
If 81 is the annual cost of ST. 900 pro-
lection at age Is, then $40 is the an
nual cost of $1,000 at age Is. Hence,
it is plain that if 81 be considered an
adequate payment for age Is, it will
not be such at age 65, for $40 would be
the cost at age 65 upon such a basis.
If, however, the party pays S12 per an
mum instead of 81, and only 81 of it is
used to pay claims and SIS per aunum
is invested at 6 per cent. compound
interest, the sum realized will enable
the Order to pay, without loss, the
$1,000 If death occur at age 6S. There
fore, If only 81 is to be paid in, where
$12 is necessary, then the benefit or
the amount paid out should in equity.
annually decrease, so that the average
amount of protection would be seven
twelfths of $1,000, viz: $3.50, as $1,000
divided by II multiplied by 2 equals
1888. What then becomes of promise
to pay $1,000 in case of death at age 65
on the sole condition that the member
continue to pay his 81 per anuum?
Thistle other members, who in
equity do not owe it, must pay $417, so
that the promise may be kept. But
thinking men land there are multiplied
thousands of them in Beneficial Or
ders) do not wish to continue making
and fulfilling such promises.
IS THREE A REMEDY? YES.
1. If the amount collected from the
member is simply sufficient to meet
the cost for age at entry and no ad-
dltional payment is required, then let
the promised benefit grow proportion
ately less each year during member
ship. For instance, as in the above
let it average for 40 years
1888, thus granting to the member
every dollar of protection that he pays
for. Or, if that is not desirable, then.
2. Let the amount of the protection
remain at $1,000 and let the payments |
of the member increase each year in
keeping with the increased risk. For |
instance, in the above illustration this |
increase would be from 81 at age IS to |
$40 at age 65. Or, if that is not desir-
able, then.
3. Add to the payments to be made |
by the members a sum sufficient to |
make it safe to promise the full $1,000 |
in return for the stipulated, unehaug- |
ing or level rate which the member |
pays. For instance, in the above illus
tration the level rate of $12 for age IS.
1t will readily be seen that while the
man who paid only 81 per annum left
an average deficiency of SAY if he
died while a member, for others who
did not owe it, to pay the man who
pays $12 per annum is supposed to
leave no deficiency for others to pay T
if he dies at age 65.
Now, the principal object of this
article is to call attention to the de-
fciencies of the character named that |
are constantly arising under the prac-
teal operation of the plans of many of |
the orders. While the above i11ustra-
ton is not a scientific life insurance
nor intended as such, yet /
the deficiency shown in it is not over
drawn, and as the members pay all |
such deficiencies, they are the ones
most interested and should aid in |
every practicable way in bringing
about proper adjustment in case the |
present plan of their order is defective
in that.
TO SUM UP.
From what is shown above. 1t must |
be evident that the party that pays
only 81 when he ought to pay S12 does
not pay enough, and the organization
to which he belongs must suffer loss
and as it is made up of members, the |