New-York tribune., 1903-02-04
FIFTY.sEvENTH ANNUAL REPORT
OF THE
CONNECTICUT
MUTUAL LIFE INSURANCE
COMPANY.
To the Members.

To the Members
For many years the operations Of the Connecti-
cut Mutual have been assuming more and more
distinctive and peculiar interest for its members,
for the American public, and for the whole in
surance world. and for several remarkable rea-
worth noting.
For many years the great majority of
panies have been gradually swerving from the
lines of practice which native and Inherent
in life insurance, until at last many OF the largest
and most rapidly growing companies have openly
abandoned the motive OF life insurance as the
motive to which they appeal for their business;
they longer offer the results of real life nsur-
attained by them the attraction TO the
whose families need its protection and whose
business they seek they give their contracts other
names; they suppress far as possible the ap-
pearance of a life insurance contract. they en-
deavor far possible to give them the ap-
pearance of a profitable investment for the in
sured himself. He is offered not life insurance
policy for the sake of its protection to those who
need its protection. but a Bond" as money
making investment for himself trusting appar-
emily. to the general ignorance not to discover
the unalteTable facts which make such thing
impossible. far the great body Of their
clients is concerned, and possible, II at ALL only
to a few at the undue expense Of the MANY.
Life insurance undertakes to pay the money
value of mans life to those dependent on 1t.
whenever they may lose it by death While he
lives he contributes to paw the values of other
mems lives by way of premium proportioned to
his risk of dying, according to his age His risk
of dying increases each year. but his premium
does not increase therefore it must be so calcu-
lated that a proper part of 1t be put into
Reserve Fund to meet the future increase OF the
risk; this Reserve is put interest, certain
part of which is yearly added to the Reserve: an
addition to his premium is also made to provide
for his share of the expenses
If the death losses heavy as vas as
surned ir computing the premium il the interest
earned is higher than was assumed, and II
the expenses much assumed. then
the company will just pay its losses as they oc-
cur and there will be nothing for anybody;
the cost of the insurance will Just equal the in
come but if the losses are lighter, the interest
rate higher. and the expenses less than was as
suned, a saving will be made each Of these
items of total cost and that cost TO the COM
pany will be much less than the assumed cost.
Mutual Life Insurance undertakes to give each
his insurance at only what it costs the COM
pauy his equal share of that total cost in pro-
portion to his risk and to the premium he has paid
in. 1t returns to him. therefore. his share OF the
savings If it does this each year. then he pays
each year only what his risk has actually cost the
company for that year. The more carefully the
risks selected the better the rate of interest
earned the smaller the expenses in proportion 70
the income the greater the whole yearly saving
the less the total 10 the company, the greater
each mans share of the total savings and the less
his share of the total cost-if he gets back his
share of the savings That is Mutual Life Insur-
ance. There is no speculation in that; there is
nothing in that to make it attractive a as
personal venture; it is pure expense to him, and
no one is advantaged in any except his bene-
fciaries, who get the value of his life which
they would otherwise have lost by his death.
Inc only motive for man to take policy of
Mutual Life Insurance. therefore. is the need OF
those dependent his life for its protection, and
his duty give that protection to those whom ne
has made who rightly are dependent on his
life and financial product, and his desire to get
il at only its actual proper cost
The only way make a policy attractive as a
personal venture TO any man is to do away with
mutually except in the premium charged; charge
the full mutual premium. but instead OF giving
hack to each man his share of the yearly savings,
divide them up among only few and make the
rest go without.
No man would accept such a proposition unless
he was either assured, or felt considerable de-
gree of confidence that ne was TO be one of the
few So the thing is put up as gamble Each
man agrees to leave his share of the savings with
the company for, say. twenty years; that II he dies
meantime, his policy being still in force. all his
yearly shares of savings which he might have had
back shall be forfeited the company for division
among the final few also. if he does not Keep up
his policy, his share of the savings while II was
in force shall go the way. The division Is sup
posed to take place at the end of the twenty years
among those who have survived so long ana also
have paid their full premiums stralSht thIousn IN
cent whatever the company allots to him as his
share there be statement OF the size or Ine
expected value of the share in it of each Of the
final few is set forth in the estimates & 6i vaes
feature of all of which is the postponement OF an
Chance Of being in at the final division and getting
what others have lost that is the attractlon' ao
not to his sense of duty and honor toward his de-
eompanies originating the scheme. is about one in
three. At least two-thirds will drop out oy tne
So ne Stakes his own proper share of the savings
+ba fhsr ryyn-
company holds the stakes without accountaoihty
Notwithstanding the fact that none Of the com
panies doing this sort OF inyessmen. @ ousiness i
mated the estimates which attracted the invest,
and that these Sydenof LEI b naus Of
their experience it is that they still succeed
Peronai 1n in7erest in what is made to appear
good thing" for which some one else Is eS e
more easily appealed to- with less effort and with
much pe46ler s be bas made helpless and depend
| ent and whose protection ne mas no rignt 10 put
II The point of view of the companies selling post
poned dividend schemeS Is syen to it's sgeats bV
of the very largest Of them hen @ the - italics are
head and Keep out OF the INVESTORS @ bead & that IA
simply ass"rng@ IN ms M ve Tn9g the
matter accurately and seentiheabiy al YGg ga, are are
| that You add the idea of insurance Insurance OF
what? Why. insurance OF the tnoesfmsrf: oIs II
than it is fire Insurance or marine & insurance
is hord insurance" But your cIIeiit may say
THE question of cost is gamble after all Wen
| YOU can for the sake OF argument ADMIT that
| it is a gamble 1t may aid you IN seiilns your
| bonds" 49, -oa. h,,1t- of b,,si
nees now done by life Insurance companies IS
| made to appear and TO be as little like real Lfe
ciai venture Of personal profit TO the investor
es rossfhe that the operations of The Connect
a. ~ pS3,tusi take on a peculiar interest 70 all
| whose families need the protection that pure life
insurance alone give
For The Connecticut Mutual Is not orerlng
| bonds 'fngestments wnich can De mace e, an