Practical remarks on the present state of life insurance in the United States : showing the evils which exist, and rules for improvement : to which are added the valuable tables of associated actuaries, now printed for the first time in the United States / by Harvey G. Tuckett.

  • Tuckett, Harvey G. (Harvey Garnett), -1854.
Date:
1851
Catalogue details

Licence: Public Domain Mark

Credit: Practical remarks on the present state of life insurance in the United States : showing the evils which exist, and rules for improvement : to which are added the valuable tables of associated actuaries, now printed for the first time in the United States / by Harvey G. Tuckett. Source: Wellcome Collection.

Provider: This material has been provided by the National Library of Medicine (U.S.), through the Medical Heritage Library. The original may be consulted at the National Library of Medicine (U.S.)

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    our readers this explanation, but at the same time would request them to observe the difference between those Companies which are restrained from employing injudiciously their reserve fund, and 11 charters require payment at death (see p. 15) of enormous dividends. Life Insurance has been called the art and mystery of compounding money. If A. pays B. $100,which sum B. places at 6 percent, compound interest, at the end of the year he will have $106 ; but if l>. gives A. back dividend, he (B.) will only have $101/^, and will be compound- ing at only one and a half per eeut. In the so-often misquoted Equitable, of London, we have an extraordinary instance of the powerful, long-con- tinued, and uninterrupted operation of compound interest. In the 86 . their net premiums have amounted to $95,338,180; they have paid claims to the amount of $126,683,185, and have a capital still remaining of $44,000,000, with liabilities amounting to $71,000,000. But it must be borne in mind, when comparing the position of the Equitable, of London, with similar institutions in the States, that, in 1816, when the British stocks were 60, the Equitable were possessed of $32,500,000 of stock, now worth 97, and they have never resorted to the modern practice of pay- ing five per cent, commission on the premiums, by which they have saved 85,000,000 from being alienated from the funds of the Society. As Insur- ance Companies do not publish a statement of their liabilities in the State of Pennsylvania, and have gone so far as to obtain an act of the Legis- lature to protect them from any such inopportune exposure of their affairs, the value of their policies outstanding can only be taken from an average deduced from the amount of premiums received. The Table C is an analysis of the statement i I at forth in the years 1848 and 1849, by the Penn, advertising eighty per cent, dividends, a guarantee capital, and note of hand payments. Their premiums charged arc correct; the business they have transacted in two years and eight months is a fair average; and may ultimately (say 20 years hence) afford a one and a half per cent, dividend ; making it the more lamentable that the officers and trustees should have fallen into so grave ai ' ')' per cent, dividends, and allow their agents in different States of the Union to publish th' nonary and outr ate of an imaginary return of premru] The Company whose affairs are analyzed in the Table C for the years 1-1- and 1849, have since published tip of their business for the year 1850; and, it is to be hoped, hi I the fatal ke they made in attempting to force business by the pron eighty per cent. Dividends. 'II ; thi Penh Mi n vl for the year ending 1st January L851 b ,,. and in accord- ance with the principles laid dov I I 'Hit in the Table O, it will be now shown what is and what, should be the state of this Company, and the extent to which the bat ill future insurers have been compromised. By a reference to Table 11 tl !er will find the Pknn should hi * One dollar per anvwt* at one ami a half per cent in sixty-two yoars at com- pound interest will amount to one I. I one dolllars 13-100. Onedollai per annum at six percent, in six' is (the same time), at compound in will amount to six hundred and one dollari OE 100. It is on six per cent, compound interest the premium is calculated.