Omaha daily bee., 1905-02-15
FIfty-nlHth Annual Report
OF THE
CONNECTICUT MUTUAL LIFE
INSURANCE COMPANY.
To the Members:

To the Members:
The experience of The Connecticut Mu-
tual in its tifty-ninth year was satisfactory
and may be thus outlined Some increase
In the new business written, in the amount
OF business in force. in premium income,
in interest and rents, in assets and in
surplus; somewhat heavier mortality
than in the preceding year, though still
considerably less than that expected, Civ
ing a saving OF S252 .S23, with no outstand-
ing contested claims; a considerable de-
crease in the amount and cost Of fore
closed real estate: a recovery in market
value of other securities of over sS76,OOo
as against the shrinkage of about sT7o,OCO
in 1903; reduction in the ratio of expense
to income; a sound condition throughout
The company continues in that steady.
full tide oft'benefcent operation which
has for so many years distinguished II
among all others, by administrative meth
DDS which hold always one grand object
in view: a maximum OF result to its bene-
ficiaries at a minimum of cost 10 its policy
holders each and all.
All details will be found in the financial
statement which accompanies this report.
An Interesting summary.
A summary of the operations of fifty
nine years may be stated thus: Received
from policy holders. s2S2, 100, 26LSs: returned
to policy holders and their benefciaries.
S2S4, 1853, 4Ss9S, or S1,5eA22L65 moro than the
amount received from them; with assets
in hand of $65, 5,224Sl.5S, and a surplus of
81, ,S2S, ,69664 with which to meet liability.
actual and contingent, of $50, 800, ,144.S9 on
$167, 167, $500 at risk on 7o,454 policies Ex-
cept in the possible case of some society
or concern with only a local and slight
membership, no comparable results have
been accomplished by any other American
life insurance company
Persistence of Business.
As for many years past, a most graft
flying feature OF our experience has been
the persistence OF our business. 1t has
been no small factor in the company's pros
perity. Business which goes off rapidly can
be replaced rapidly only at an undue cost.
Business which stays costs little and per-
mits the taking of new business sufficient
for uniform good experience at such
moderate cost as does not disturb the
favorable average. That is one of the sim
pie secrets of The Connecticut Mutual's
unequalled success
New Businessi It's Character and
Cost.
The new business of the year somewhat
exceeded that Of 1903, and also exceeded
the amount Of business ceasIng; so that
there was some increase in the amount
in force. The new business was selected
with our usual constant care to take only
such risks as are likely to give the same
favorable mortality experience which has
been so large a factor in reducing the
actual yearly cost of our insurance hith-
erto; and 1T has been taken on the same
low basis of cost which has been directly
reflected in our large dividends to policy
holders throughout the company's life
time.
To the faithful agents who In the midst
OF thoroughly demoralized competition
ana despite the always pressing tempta-
ton or much higher commissions and al
lowances from others, choose to abide
| steadfast in our service because OF its
greater value to those whose need thew
sincerely seek to serve, there is due alike
from the management and from the policy
holders benefited thereby, the distinct and
constant recognition of the high. unseIfsb
quality of their labors for the preatar
good of the whole membership.
Relation of Mortality to New Bus,-
ness.
The public is often given to understsn nd
that as a large and rapid influx of new
business tends for time TO keep down
the average age Of the business as a whole
and SO to make the death losses appear
smaller percentage OF the whole amount
at risk, 1t really gives a comparatively
better mortality experience and therefore
Justifies Its abnormal cost. This is not
true. 1t bellies the whole basis and struo-
ture Of life insurance. IT is worth a mo-
ments examination:
Take 10000 sound men, aged 80, insured
for $4,000 each, or 10000, 600, altogether.
We know within safe limits how MANY or
these men will die each year until all are
gone; we charge each one the premium
adequate to meet that rate of loss, and
from the premiums make the proper re-
serves. The frst year only "a will die.
the company will pay out $40 900, or only
eighty-four one-hundredths OF ! per cent
of the amount at risk: twenty years later
| there will be $3.50 OF these men living. with
$Sl 100000 at risk; 124 OF them will die that
year, the company will pay out $1,000
or III per cent of the amount at risk: In
| the fortieth year AIS will be living, with
| $4, 10000 at risk, 265 will die, the company
| will pay out $2,65O,OOO. or about per cent
| OF the amount at risk; In the fftieth year
there will be Ito living, with $17,7OO, 900 at
| risk, 230 will die, the company will
pay out $2,3O0,000 or IS per cent of the
| amount at risk; in the siXtieth year only
| PIG will be living, with $2,16OOOO at risk, 81
will die. the company will pay out $3.50, ,OOO
| or about 30 per cent of the amount at risk.
| But the mortality which in the sixtieth
| year OF the business calls for 30 per cent
| of the amount at risk 10 just as normal
| and just as favorable TO the company as
| that which In the first year called for
: only eighty-four one-hundredths of / Der
cent; and II the company has charged the
proper premiums and kept the proper re-
serves 1t is Just as well prepared to pay the
| 30 per cent as 1t was to pay the eighty
four one-hundredths of per cent, and If
located, the chances for a mortality more
favorable than that calculated for, with a
consequent saving on losses, have been
equally good all the way through.
No amount OF forcing at whatever cost
can always keep the inflow OF new bust
ness greater than the outgo of the old.