Webster City freeman. [volume] (Webster City, Hamilton County, Iowa) 1884-1946, 1915-03-02
pany, but the dividends in the Con-

pany, but the dividends in the Con-
necticut Mutual begin at the end of
the first year, and the amount paid
this year on this policy issued III
1914 is $4.O2, or just seven cents
less than the original difference be-
tween the two premiums. AS poll
cies grow older the dividends natur-
ally increase; in this instance the
third premium is lower than the
Central Life non-participating rate.
This same policy issued at age 40
twenty years ago, at the same prem
ium and on the same reserve basis,
has returned to the insured in divi-
dends $257.45, making the net cost
$361.35, or an average annual prem
ium of only $1S.07, as compared
with the non-participating rate Of
$26.S5. Moreover, the guaranteed
cash value of the policy at the end
of 20 years is $3S9.47, while the
Central Life guarantees $367.63.
The advantage of The Connecticut
Mutual in premiums, amounting in
this case to $175.3O, will look good
to the policyholder, who will not be
disposed to quarrel over a technical
ity. A dividend "by any other name
would smell as sweet" The insur-
ed, if he carried policy in each
company, would no doubt come to
the conclusion that after all there
was an "overcharge," but it would
be the overcharge made land kept
by the Central Life. I should like to
add that this same Ordinary Life pol
icy bought twenty years ago at age
40, the dividends having been left
with the company at interest with
drawable at any time) natures as
an Endowment this year, the insur-
ed himself being paid a little more
than the face of the policy in cash.
A "frill" as Mr.. Terrell puts it, but
a very desirable frill at that. If
such "frills' are to be condemned,
perhaps he could give an "Explana-
ton" of why SO many of the nom
participating companies feature
"Guaranteed Dividend" "Guaran-
teed Premium Reduction" and "Cou-
pom" policies, which are, upon their
face, deliberate attempts to make
the prospective applicant believe he
is going to get the same thing the
participating companies really pay
"a "dividend!" It is to the credit
of several state Insurance Depart
ments that such issues are positively
forbidden. With another slight
to Mr.. Ferrell's article,
we may say with him ''There is no
such thing as a (guaranteed) divi
dend in life insurance"
With respect to other forms Of
policies, such as 20-Payment Life
and 20-Year Endowment, the adj
vantage of the Connecticut Mutual
over the Central Life in net cost is
even stronger than indicated in the
foregoing illustration. Nor is my
own the only annual dividend COM
pany which shows and has for many
years shown a much lower net cost
than the Central Life. There are
even several non-participating COM
panies whose rates are materially
lower than those Of Mr.. FerrelTs
company; what will he call that diff
'erence-an overcharge? Nor is the
element Of cost settled when the
premiums cease, in the case of paid
Up policies in the annual dividend
the dividends continue
o be paid every year the policy re-
mains in force. Now, since the net
cost of these policies is, in the long
'un, lower than that of the non-par-
icipating forms during the prem