New-York tribune., 1902-02-03
Mortality.

consequently greater with corresponding increase
IN premium income and in assets
I Mortality.
Owing to the age of the company and the remark
ably small proportion of lapses and surrenders ana
the consequent persistence of its business ts risks
have come have a greater average age tnan
tionatey larger resources in the reserves held on
average age the mortality is necessarily large Is
tar less Than was expected and has been proVi,as1
part OF which becomes each year a saving tso.n @
year amounted to $5s5 Sls
tr volume Of Tk their G excellent utb abe
the new business is selected to replace the Old al
TpIe IN r%te anu t b;fr nf fbs compsnv its
losses have been less than four-hfths or those eA-
Expenses of management
The same careful economy has been exercised as
in all past For the last two or three years ths
expenses incident to the care and repairs upon fore
closed real estate which have been charged 70 ex-
Pense account rather than TO the ,PTaT hSher
than usual standard This dinerencs VII ~ as as
posed Of The ratio for 1901 was less than that for
Real Estnte. Interest and Investments.
For the seven years prior 10 1901 foreclosures OF
mortgages were in considerable excess OF sales
During the last year. however. the situation mas
changed; We took in proPerties fSsns S "a IS Some Of
these sold at profit and some at less Ihdn o,,r
cost Many OF the properties sold W~eIe 49, - b,,si
older holdings I'm localities Whers CnIs Cits5 I-.GIss
had permanently depreciateI, tJer
Which 5' Win pare probs6g she se {or Something less than
cost and 1t is our purpose 20 loss and so
improve income and reduce expense ~ ,o9v n rss
sonaby expect some gain in fair market. we
foresloasd n5ys 59sdT real q sSSa estate ee'''
The large addition to the Home Office building
referred in our last report is nearing conpls.o-
and is being followed by changes IN ana aooi'0nS
sN,- Wrr~1.a IN a
together with god prospect oil
financial result.
The interest rate on desirable and securities
has tended to a still further decline with growing
scarcity of satisfactory investments for funds IN tne
nature of a trust We have considerably rsdueea,
loans reai estate and Increased our ho'iins 'A
irst-class railway securities -. - MAJ.
The balance net profit OF the NefV upVt
sssso5,7s ssSSEfs in securities anu '1'e -
The market & gsqs Of fe our resT aHd tsS 5
Saracter to be least unfavorably affected by mar
ket fluctuations
Surplus and Dividends.
As the cost Of a mans policy in a mutual insur-
ance company is the difference between the pre-
miums charged and the amount returned to him oy
way of dividend. the surplus earned ana tns sSI SI
experience With his company. Surplus can Ss
earned egtimaeiy in only I,IiTr thru STods tor
~ by less mortality than Is proylded ios' s g -.
BILE in computing premiums and reserves. -.
For many years the Sonpetiu9Sn 10 7 ns cHmpsrjss
in has also led to good deal of apparently doubt
deaIing with hazards and the steady decline In the
interest rate has eaten away much OF very I'M
The matter : of somewhat special interest to Us
al AT tnii S s b been in recent wears aud is st
being quite largely PERFORMED by Solt ~
comparison with the increasing scale maintained
hv The Connecticut Mutual for uoN twenty-ons
vsars ie met nv the assertion that ths company.
too. must presently cut down its returns tnat Jns
is already diminishing
We have never undertaken to prophesy- We do
not try to PREJUDICE events We pr'teT TO meet
them and our duty To YOU under them without
pressure or prejudice from wrong prsConCeptlons'
or from having put ourselves IN IsL5e p0sitlon,
dividing and can no longer safely trench upon the
sfe eHfS TIM prent rate Of Dividend we shah not
hesitate say and TO act as the facts may re-
f0''' History of Our surplus.
We only wish to call the attention Of those in
| manner Interested to a few pertinent facts:
| For many years this company has been governed
! by the idea that while surplus should be quite
! closely divided each year as To make a nans ;
payments as small as possible. yet. as il is impos-
made and as a gradual If small annual reduction
( in payment tends To the persistence OF the ousi-
ness II is desirable in unusually good years 70 ae
cumulate such margins OF surplus as may De eaIned
W he Ia d in nsintainiH. The dividend rate in the
years when the margins may tdll below ~ Sreatiy
ment by post-mortem dividend being made, II
works no inequity to any one
I
sion 10 trench very largely accumulated surplus
| in his manner. In 1881 its surplus was S.591lSS.
which was 81 per cent of its assets The cOndi-
tious being untOward. IL was decided 10 reduce the
dividend scale the apparent actual earning
capacity From this point We began TO earn small
items of surplus above the amount annually
divided In 1852 recast the premiums and re-
serves for all future business on a basis or m
stead of per interest, which cut down tbs
margin for expenses and INCREASED tne anSHnC re-
! qlired NOJwtthStandlng IN lsS3 the
surplus had crept up TO Se.OSS.l5o II was then
deemed TO literally revise the scale OF dlVl-
I gfO brIt he continued increase
1895 when il stood at S.5lSS- Since then IL ma,
been somewhat drawn upon each year 70 maintain
/ e necessary to do this, n IL long remains
necessary how far we may deem 10 wise and
/ II Is a Just and proper as We'll as the intended
use OF past aCcUmulatiOns or surplus so long as it
is safe. When II approaches the questionable
point shall stop and frankly go upon Il scale
to govern the 1uture
We could spare s25O0.O0o from present
surplus Of S7Oll O4O and yet have large a per-
centage TO assets remaining when made ths
last cut in 1851, saying nothing Of over 2.f7O0eo
greater comparative strength in our reserves by
reason the three per cent interest assumption
We are maintaining the low cost OF buSineSSs
OF real estate viii gradually reduce taxes
and expenses and improve the surplus income. and
We shrunk surplus last year only
And our situation respecting the use Of surplus
differs materially from that of most companies in
this. that the bulk OF theirs is held under a.
deferred dividends hoped for by those who out
stay the next one TO twenty years 1t Is not so
with n TS f6r III the Is ben bene fa Of the bsSes f
Of the operations of hfty-six years:
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