Low Rates Of The National Life Endorsed

We cheerfully commend the followlng from the published literatura of the Life A sociation of America, as a Btrong argument for low cash rates. " The Mutual Lift: ' and "Tbe Mutual Benefit " are sound pop ular coinpanies, and the objections made by tle Ufa Amsocialion lie not against these compauics as comparecí witli others of the! r class, but against the principies apon whlcl the companies thcy represent are iounded The subject discussed is of interest to every policy-hoKler and to every person ivho may becoine such : - Why do Mutual Life Compartios charge a blgber premium thsn coinpanles ou the stock plan? Because been r capital thiy liava consista of accDradlatlODS from premiums, and if the premiums should prove too low during any year the coropany wouid be iusovent, haying nothlng to fail back upon. It is deemod neecssary, thercfore, to add to the premium whicli is re quisite for the naiirance a margin for securily - somethiug to take the place of capital stock. This margin, if not needétfj is usually returued at tlie end of each year, as part of the dlvidemls. It will bo seen, therefore, tliut wblle a mutual campany has 110 stock capital It must have something to take the place of it - somelhiiig that furnishes the necessary secnri'.y. In the stock eompaiiy this teeurity is suppllecl by tl c stockliul'lcrs ; in the inutaal corapuiiy by pollcy-boldera, In the sliapu of increLged prtioiiums. For exarnplc, ve fln.1 the animal prent urn di .i -ÍKJ.UOO pollcy in t!ie Mutual Life, ol New Vork, ,s lollows: A . ; TsnFayment LUs Plan, (324 00 Tlie Premium on tho Bamc polii ; m the Xatiunal Lifc-8tock-CúmiKiny ia 3!2 UO Showinj the cxccw.i 'tf the Mutual T.il'o prciniuia to bc 153 00 If we íuppose that the Mutual Iiife Mas lifty miliions of tliis kind of losuraucu in (orce, that companv will Obtulo, annually anexcessof premium over tlie Kat lona l Life, on same annuiiit, of iföO,OüO, whicli is the capital, Oï sicnrily fund of tho Mutual Jjife. At tlie cud of the year thla is returneil to the policy-holders, witli such proflta as miy have been earne.l. It is colkcted by the name of prttMum and relamed by tiie uu me ot dividend. Bui t should not lx; forgotten that this securily fund, wliich ail rulmit to be neecssary, is obtalned in this way iy ilie .Miitn..! lile at a very heavy cosl ; collectlng it as a part oí the premium subjectg it to largo commissions, taxes ;u:il otllur expenses, 'i'o illusirate: W e flutl llml tho locóme from premiuiiis of the .Mutual Lile last year %.v.i 1807,802; the premiums j:i the same ainount and kind of nsurancu i;i the Na tional Liie woniil have been, say $9,308,4U3, or 3,98O,i'4O Ies8. Ihi latttr amount tea culi et d f ir purpouê of eurity. The expenses of tlie Mutual Life, last yc:.r, were lljá por ciiit. on its premium recelpts, üo that bj' tnnltlplying tho suni coüoced for purposea of securlty (f8,089,340), o above atafatd, by tilla perceatag, we w i : 1 tliiil that It cost f4S8t773 to procuro the securily. Of course this largo imoufit was pald by and lost to the pollcyholders. And it should be rememberod that thej iflü not p:.y this nioney for the u:o of the wip tal- .'or gettlug capitalista :■ RHpply It nul run Ihe risk of loss- bilt merel; for handllng It, us the policy-ho!d era contrlbntetl it, tlieinselvus, and conse(liu-ntly ron a!l the risk. Nou-, tlie dlflvr eucu bctwcen the Mutual Lile'n operatlon and that of u " note " or " ion 11 ' coropuny sjust tliis : Iu the l'ormer c"s ihis morir In (br securlty Is collected in -ih. and pa ld b:ick in cash. [n the latter en.e t is colli rtril . ,' tet ,■!■ li( us mi the pollcies, and returued in note, or ly a relliiQUlslimcnt of the Menu. Tbc two ito not (llfliresentl;illy in pr!nclple, Uut the iioie opefatlen exhibas :in absurd aspect Por exampli Tlte Mutual Benefit L'lfc lnsnnmce Co , ol NTow Jersey, collei teel $5 4s).:ís; o' premium La 1860. Ofthls amount $8,103.801) was in cash, and $2,823,587 In notes. These notes wel'e laken for tllfl purpose of ioriDlDC il ■ecurlty fund, witli tlie iiutleratandlBg that tliey would 'e rcllnqnlshed &8 soon is tlie ucccsBlty for bolding them should ceace. Tfte reporta show that the expenses of tlie Mutual JJeneüi Wtre 11 ', per cent. on its premiara recetpts; thcreroro, by Danltlply Ing the amoont of tUesc note, f2,338,887, by tiii-i per ceiititge, tvcfliul the lare sum of $301,307 07 pald for baodllng ihem. In otber words, (liiiiii;; tbe year 1860, the Mntiifti BeneSt pald iis ngenls aml otliers if 01 ,í!í)7 01, in tash, Sir induclug lts pollcy holders to en 1 it their notes ofhülld, t be used for the pnrposc of securkig - wlioni 'i Why, the mokert of lli noten! Consumera of spirits will be glad to loarn that i prooess ia diaoovered wliercby the Líitrbajíe of oilies c;m bo distÜled, rnd four gallons of proof spirits obtuincd froin ovory barrel of tlio soavengei's produüt.