Deseret evening news. [volume] (Great Salt Lake City [Utah]) 1867-1920, 1908-10-31
LIFE INSURANCE

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tAll questions relating to life insur-
the Press Rurcnu OF the Utah Assu.
citation OF Life Underwriters. Address
Z. y. Box d2d, Salt Lake City, Utah>
ME Life Insurance Independent
of New York publishes the Long,
4 loohad-for opinion concerning
the controversy between the
Kansas City Life and the Utah Associa-
ton Of Life Underwriters This opinion
Will be of interest at this time When,
surance supervision In the state many
unsafe propositions are being sold
With the belief that the views ex-
pressed by the Independent may serve
as a safeguard for the present and flu
8ture as well as the opinion is submit
ted:
'Gentlemen: Agents of the arc
offering Il special policy guaranteeing
paid-up policy in 10 years for the
price Of a prepayment lie; also other
special features. Can You give me any
Information concerning this proposition,
and will 1t be a safe policy for me to
buS?"
To this straightforward question the
Utah association gentlemen published
the following answer;
ITO quote from an authority on the
company you mentton THE -----
Life is writing the advisory board con-
tract wherever 1t is permitted to do SO,
which. however, Is now only In a few
states. The company has never ma
tured any of the policies it is offering
for sale in this state. and we doubt
ysl 1,.,f
actually correct The expense of man
asement in 1907 exclusive of taxcs)
was 42.22 per cent of the total premiums
received. The company reserves at
per cent, and its premiums are higher
than most companies deserving at 8 per
cent. We believe also that the first
year Is full preliminary term insur-
ance, thereby giving the company the
whole of the first premium on every
policy for expenses.
When companies that have been
In business for half century and
longer cannot guaranteed to mature a
2O-payment policy for 1b> annual pre-
miums, we are somewhat doubtful as to
the integrity of the company In ques-
stlon. when it is remembered it is only
in it's thirteenth year Whenever
agents offer something no other CONF
pnny can give 1t is time to look before
you leap.
We do not believe the policy is the
safest for you to buy
Passing upon the main points at issue
between the Kansas City Life and It's
accusers, the Independent has this to
say!
1T is true that a legal reserve COM
pany aged 13 ought to be as well able
to meet its obligations as If it were 80,
If carefully managed. But there are
two points to be noted here. The Kan
q ~,
serve company since 1903. and its man
agement since then has been anything
but careful. Readers of the Indepen-
dent will by consulting their files for
December. 1906, January, 1907, and
April, 1907. recall that on those occa-
sions we commented upon the reckless
ness shown by the company In rein
surfing the deteriorated business of the
Fraternal Home. without medical ex-
animation at gross rates which We're
much less than the net premium of the
American experience table, and 4 per
cent interest, thereby creating a techni-
cal deficiency which would have to be
made up out Of the surplus derived
from its other business Such action
on the part of a company has a very
Important bearing upon the question
whether it can meet Its obligations In
the future The company claims to be
a legal reserve company. but legal
reserve company, according to our un-
derstanding, Is one which maintains the
full legal reserve. which, so far as the
above transaction shows the Kansas
City Life does NOT.
HPhe statement that the company Is
no longer writing advisory board con-
tracts may readily be believed, especial
" In view of the fact that the number
OF states In which 1t would be permit
ted to write them is now very few. If
1t has repented 1t is a sort of death-bed
repentance. However. let there be joy
in heaven because this one sinner has
done penance for that one sin, and let
us pass on to the other.
The proposition to give q, paid-up
policy to the holder
of q participating 20-payment life policy
on his making Is payments and forego-
Ing all claim to dividends. may be q
safe and equitable transaction If made
by a responsible company of standing.
The Travellers or the Prudential. both
companies with plenty Of capital and
reliable business methods. are offering
u proposition which is virtually the
same. Nobody doubts their ability to
make good any actuarial deficiencies
that may arise on such a transaction.
But the Kansas City Life? Ugh! What
guarantee has the pol;cyholder that the
dividends which they ask him to leave
with them, will not be used to pay the
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