The Montgomery tribune. (Montgomery City, Mo.) 1892-1910, 1903-05-22

~ F;NNl purely benevolent character. have had a continuous
existence in Europe.
The early societies OF this country were crude in
-@ their plans and were based on the idea Of chcapness
In contrast with the expensive cos, Of insurance furnished by the straight
life, or so-calcd old line companies.
The earliest societies lacked most of the elements which are nov
found in the new system aud which are regarded as essential to their
susc ssful operation. Formerly the cost Of maintaining membership
has n. relation to the age or the character of the risk. each member be-
ing assessed a uniform amount. ordinarily a dollar. on the occurrence of
a death.
1t was ascertained from experience tina, it was as essential for fra.
!ernal insurance societies as for tile old line companies. to recognize and
adopt the elements which undcric the science of life insurance. Grad
uary, there has been embodied in their plans a consideration OF the cost
OF furnishing insurance. with a due regard TO the mortality rate, as dis
closed by experience tables, with distinctions as to age and character of
employmcnts as affecting such mortality rate. In fact, the system has
reached sufficient age to profit from its own experience. as well as from
that OF the old system, 30 tina, it I. able at this time to present a homo.
geneous and well defined form in the various plans which prevail in the
most progressive of its societies. The old line companies have been wont
to criicise the fratcrnals and to predict their calamitous downfall after
a short aud eventful career, basing their criticism not only on lax man
agcncnt OF their executive business. but upon defective methods in the
selection Of risks. through careless or incompetent medical examinations
and a disregard for the stable elements of life insurance. 1t mus, be
admitted that the fratcrna' society in its early history mcdted the crit.
cisms thus passed upon il; but. SO great and forward have been the
strides made by it in recent years. that the dangers and weaknesses
winch nnpcrIed its existence have been overcome and eliminated and
there is now presented an intelligent organization which embraces i'll its
makeup all OF the elements upon which the old system relies for It's per.
pctuaion.
Most notable has been the comparatively recent embodiment into the
fratcrnal system Of a reserve fund feature. which provides for the pro-
lection of its certificate holders against the increasing cos, of carrying
the risk, keeping pace with the increasing years OF the lives insured; so
that at the present time. all Of the new societies are rapidly making sim
liar provision in their plans.
In this connection. it may be stated that in the use and classification
of their reserve funds, the iratcrrals have a decided advantage over the
straight lie system. inasmuch as the reserves of the former are known
and available : assets. while those OF the latter arc classified and
charged as liabilities.
Furthermore. the wisdom Of our Legislators is shown in the almos,
universal exemption laws which relieve the fratcrnal societies from
many OF the buricnsome requirements which rest on the old system,
although very properly making them subject to the inspection of the
state insurance departments.
The national government has also given proof of its appreciation
OF the status Of fratcrnal societies, as quasi charitable or benevolent in
Siutons. by extending TO them special privileges under the postal laws
aud by having cngraitcd into The recent revenue law an exemption from
taxation of the insurance written by them. whereas, the old-linc COM
panicS were made subject To- taxation in that respect.
1t can be truhfuly said that the older societies. and many of the
younger ones. have undertaken the necessarily unsuccessful problem of
furnishing insurance at less than cost but experience, aided BY the in
tcligent appreciation of their members OF this faIacy, due to invcstiga-
ton aud more thorough information. has prompted and caused the aban-
domnent of the inadequate rates which prevailed in the early history of
the system and led to the establishment OF a standard which is supported
by experience and the best research of students of the great principles
Of life insurance, So that it can be said that the new system is IS well
prepared as the old to meet the demands imposed upon it and to carry
out its contractual obligations.
character of its risks. it being well known that the oIdlinc system is
rich or wclltodo. while the fraiernals 10 a great extent embrace in
means.
statistics which show that ii embraces within its several constituent so
that its annual contribution to its bencfciarhs exceeds S6ooooooo. and
Of this membership. Illinois provides 100000.
I-