The Minneapolis journal., 1905-06-30
.
TOntine Insurance.
Editor of The Journal,

To the Editor of The Journal.
Your editorial, ''The Tontine Policy
Illustrated" following as it does other
Writeups along the same line, would al
most indicate that these articles are either
inspired, or that you really believe what
you are saying. Why not consult some in
surance statistics and quote some actual
tontine settlements as compared to those
made by annual dividend companies. Fur
ther you forget the fact that most of the
So called tOntine companies also issue an
nual-dividend policies and that the In
sured has the privilege Of choosing which
plan he prefers. The New York Life is
probably the greatest exponent of tontine
insurance, but it also issues annual-divi-
dend policies upon just as favorable fig
ures as the champions Of annual-dividend
policies, namely, the Mutual Benefit Life,
State Mutual, Connecticut Mutual, and
other purely annual dividend compa-
MES. The business of the Northwestern,
Penn Mutual Mutual Life, and such COM
panies is on both the tontine and annual
dividend plans, and their own showing OF
tontine settlements is better than any
they have made on the annual dividend
plan. The Chicago office of issue Of the
| New York Life issues more business each
year on the tontine plan than any purely
annual dividend company gets all over
| the world. How do you account for this,
! or is it your opinion that the public buys
it's insurance ignorantly?
| Further, why is it that the tontine COM
| panies do four-fifths of the total business
of the country, when the system OF an
| nual- al-dividend insurance is available to the
insurins public? The Equitable did not
originate tontine insurance, nor is that the
| real cause of it's present difficulty. Be
| cause of an error in the incorporation OF a
| company that has affected to write ton
| tine insurance, the business OF reputable
mutual companies should not be preju-
diced by cracking away at a principle or
| creed. the statistics Of which will hardly
| hear YOU out -Tontine Subscriber.
Thief River. Falls, Mimi, June %.
| The Journal has no fears as to
the failure of statistics to bear out its
! structures upon tontine7 insurance. Nor
is The J Journ a rs criticism answered
! by showing that some companies nave
. at times made better settlements on
tontine than the same companies have
made on annual-dividend policies. They
/ ought always to do 50. The real point
is that the tontine system demoral-
( | ICES the companies as much as it does
the insured /. It is a system OF specula-
tion in funds. stWhy, do people buy
tontine insurance when they have an
| nual-dividend insurance open to themY''
Very likely because most companies pay
agents a much higher commission to rep
resent the tontine policy to the prospec-
tive insurer.
Yes, people buy insurance ignorantly
to a large extent, but to noslarger than
man buys clothes ignorantly. He
takes the word Of a reputable dealer
/ that piece of cloth made up in a suit
is worth so much He does not know
anything about the wearing qualities
Of the goods. The man who buys life
insurance takes the word Of the agent
which ought to be the word of the
company (but too often is not) that
certain kind Of policy is the kind fol
him. If he knew the agent got twice
as much commission to represent one
kind Of policy as he. did for represent
ing another, it might arouse suspicion
The Journal does not understand
that it is "prejudicing the business
of any reputable mutual company bJ
cracking away at tor1tine insurance e
There is no reputable mutual company
which has not the power to offer in
surers either kind, and it should no
make any difference to the compan,,
: which kind he takes.
( The defeat Of Speaker Cannon in |;