The daily morning journal and courier. [volume] (New Haven, Conn.) 1894-1907, 1901-02-08

your issue of last Wednesday. For the
sake of these, and others like them, per
nit me to offer an explanation little
less statistical"
| The object of that communication was
to show your readers by means of off
cial data, not what policyholders in the
various companies have been led to ex-
pect by means of attractive literature
and tempting estimates" biased on
the past experience of the companies
but what the companies referred to
actually did by their policyholders dur
ing 1899.
| No intelligent man should need to be
| told that the company which, year by
| year, returns to It's policyholders the
| largest percentage of the premiums
| which 1t collects from them Is the best
company to insure in.
Again; no intelligent man should
need to be told that company which
| loads the met premium" moderately to
provide for running Expenses" and
then expends considerably less than
that amount, is good company; GER
tainly better than the company which
loads the met premium little less,
but in actual management spends all
the loading" or much more, as was the
case with companies No. 6, No. is and
No. Is of those referred to in Wednes-
days communication.
If a company loads the met premium"
heavily, and yet spends it all, and more
for management expenses, 1t ought to
be sufficient to satisfy the intelligent
man that it is an excellent company not
to insure in.
All solvent companies will pay their
death losses and their "matured en-
dowments." In getting insured in COM
panies doing business on the mutual
or participating PLAN" it is purely
question of dividends" or, more cor
rectly, question of rebate"
Let me say right here that "divi-
dend" or rebate" in life insurance,
comes almost wholly from the following
three sources, viz:
O From the 'mortuary fund" Not
as many die during the year as the ta-
bles of mortality called for. The differ
ence constitutes a Saving" a part
Of which at least should go to the div
idend fund"
(2) From the interest receipts" of
the company. Whatever 1t receives in
excess of 4 per cent. on its reserve"
funds, and whatever 1t gets In full on
its surplus" belongs properly to "the
dividend fund.-
3. From it's loading for management
expenses" Every company has to
Jno
any Of the money thus collected from
the insured remains at the end of the
year, every cent of it belongs to the
dividend fund"
Now see how the sixteen companies
referred to closed the year 1899.
They all saved more or less from
their ''mortuary fund.- Not as many
died as the tables of mortality called
for. Some of them saved over 40 per
cent. These would have had hand
some sum to divide as dividend"
among their policyholders if they had
not been obliged to draw on it to meet
the deficit in their expense fund"
Having spent it in that way they had
little or nothing left for the dividend
fund.- from that source Three out of
he sixteen companies made loss rath-
er than gain in their interest account |
IN their reserve fund" hence they had |
nothing from that source to put into the |
dividend fund"
One company saved nearly per cent |
N its interest account, hence had a
sum to place in the dividend
und," or would have had If it had not
,een obliged to make up a deficit of
z per cent. in it's Expense fund"
The remaining twelve companies real
zed less than 1 per cent. gain" on
heir reserve fund" hence had but lit
lie from that source to put into the
dividend fund"
AS to saving from the manage
mont, or expense fund" the tables in
Wednesdays communication show that
line companies saved something in this
way, but that seven of them lost some
I them quite heavily in this way They
ould not therefore. put very much in
heir dividend fund.- at the close of
he year.
The whole case may be thus stated:
Heavy loading of the net premium
Or expenses of management" accounts
lilly for the very high premiums charg- ;
by some of the companies; and still
eavier expenditure" in management !
for their very small "divi- {
ends" or rebate. l
The ''Tontine" principle has been ]
droitly employed by many companies !
} conceal the real truth on these t
oints S
W hen company which returns only {
n average of per cent dividend to j
S policyholders, as a whole, is permit |
ID by the terms of its contract with t
lem to withhold 1t wholly from four c
fths of their number, and to divide il e
] among the remaining one-fifth. if v
IN still make a big showing in it's cam Il
assing literature, Notwithstanding its S
Try bad showing in the official returns o
hich the public as a whole neither k
insult nor understand. But is it fair F
do that? Is it honest TO mislesd in \
at way? Is 1t really honest to take C
ON A, B, C, and p and give it all to t.
? True or not, honest or not, that is h
ecisely what many of the most pop S