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results of both these tables are below the actual truth. The former two tables were no doubt founded on facts, but these facts were not sufficiently numerous to afford a broad enough basis for generalisation. Thus, according to the Highland Society's table, the annual amount of sickness each year to each person was estimated to be at 20 years of age, 4 days; 30 years, 4 days 8 hours ; 40 years, 5 days 7 hours; 50 years, 9 days 13 hours; 60 years, 16 days 10 hours; 70 years, 74 days 22 hours: while in the tables of Mr Ansell the sickness was calculated at from 24 to 44 per cent. more than the above; and in the tables of Mr Neison from 5 to 23 per cent. more than in those of Mr Ansell. In other words, if a society consisting of 100 members, say 30 years of age each, were established on the basis of the tables of the Highland Society, and that they proposed to allow each member 1s. per day during sickness—the payment to be fixed according to the expected rate of sickness—the result would be that at the end of the first year, instead of having paid only about £21 as anticipated, the payments would have amounted to about £30. The ruin of such a society is apparent. Accordingly, very few of these societies have lasted many years: they have been bolstered up from time to time by fines, special contributions, &c. &c.; but few, if any, have adopted the effectual mode of raising their payments to an adequate scale
. This course has in too many cases been persisted in by the managers and members more through a reckless confidence in themselves than through ignorance of the dangers they were encountering. A striking proof of this was given by H. B. Ker, Esq., a barrister, in his evidence given on 30th May 1850 before the select committee of the House of Commons on the savings of the middle and working classes. He was asked: “Do you believe that the question of self-government of those societies-namely, that of electing their own managers—enters in any degree however small into the consideration of the advisability or unadvisability of increasing the facilities for forming these associations ?' His reply was very striking, and deserves to be well considered by the working-classes of this country, for it is a statement not of opinion, but of a sad fact not at all creditable to themselves. Very little indeed, as far as my experience goes. I may state that the honourable chairman and myself belonged to a society for many years,
and we collected very valuable information indeed upon all friendly societies, and upon all similar institutions, and nothing could furnish a greater mass of proof of mismanagement, and waste, and miserable loss of money, than the information we collected at some £500 or £1000 expense, and which we printed and circulated without, I believe, producing one per cent. improvement on those institutions. I was very sanguine the other way.'* A more specific case of benefits offered on too low calculations exists in the Manchester Unity of Odd Fellows. This unity is the greatest of the kind that has ever existed in this country. It numbers more than a quarter of a million of members, spread all over the country, and its income exceeds £300,000—a gigantic union, originating in the best feelings of humanity, and calculated, if well managed on a sound basis, to exercise a highly beneficial influence on the people of this country. The benefits offered are-1. An allowance of los. per week
* Parliamentary Report 508, Session 1850. Question 713, p. 67.
during sickness; 2. A payment of £10 at the death of a member; and 3. A payment of £5 at the death of a member's wife. To secure these the annual average payment from each member is £1, 2s. 9d.; but Mr Neison has shewn that these benefits can be secured only by a payment of not less than £1, 19s. 5d. per annum.* The result is obvious. The society will go on prosperously until the members become old, and the claims on the funds heavy, and then another sad failure will be added to the long list.
Many acts of parliament have been passed from time to time for the regulation of friendly societies; but they did not touch the crying evilwant of accuracy in the tables. The most recent act, however13 and 14 Victoria, cap. 115-provides that the rules and tables of every friendly society shall be certified by an experienced actuary, who must declare that the tables may be fairly and safely adopted,' and that they fairly represent the interest of members entering at those years or terms of age without prejudice to any.' This provision it is hoped will prove effectual, and place all future societies of the kind on a safe and permanent basis. It may be said that it is only recently that such a provision could be introduced, in consequence of the paucity of the knowledge of even the most eminent actuaries on the subject. The results to which they have now arrived may be shortly stated. The causes that produce sickness are exceedingly varied and complex; but three of these can be immediately grasped by statistical inquiry--namely, age, occupation, and residence. The first of these has often been neglected, for in many societies the young have had to pay just as much as the old, while the latter have absorbed nearly all the benefits. The effects of the other two are not so marked in the history of these societies, because many of them have usually been composed of people in the same trade and locality. The tables arrived at from their experience are of little use as applied generally; for example, the tables of a society in a healthy rural district would be a bad guide for a society in a large and comparatively unhealthy town; and the experience of a body of shoemakers would lead astray a society formed of miners. The tendency, howevery of these societies is to embrace all kinds of artisans, and to adopt a general table founded on the experience of the whole country. This is the course that has been pursued by insurance companies whose premiums are fixed at a general scale, and only modified by special circumstances.
In Mr Neison's work, Contributions to Vital Statistics,' the average amount of sickness to each person annually, at the age of thirty-two, is estimated as follows: Rural districts (population under 5000),
6 days 1 hour. Town (population 5000, and under 30,000),
6 12 hours. (population upwards of 30,000),
1 hour. Total,
6 11 hours. Again, from the experience of the Manchester Unity of Odd Fellows, the following table has been made up, illustrative of the aggregate amount of sickness experienced by persons in various trades ; and though
* Odd Fellows' and Friendly Societies, by F. G. Neison, p. 28. 1851.
founded on a limited range of facts, it is yet highly interesting and instructive :
Age 30 to 40.
Age 40 to 50. Blacksmiths,
8 weeks 4 days.
13 weeks 1 day. Bricklayers, Plasterers, and Slaters, 8 6
6 days. Carpenters,
10 5 Agricultural Labourers,
1 day. Town and City Labourers,
10 5 days. 14 6 days. Mill Operatives,
7 1 day.
15 4 days.
25 Plumbers, Painters, and Glaziers,
13 6 An examination of these tables, and a consideration of the vast amount of experience and investigation on which they are founded, will easily explain why so many societies, unaided by such experience, or unwilling to acknowledge it, have gone so far astray.
Another cause of failure has been the excessive amount expended in management. If the management of a large public office-say that of an insurance company or bank-be compared with that of a friendly society, the contrast will appear very striking. In the one case there are no unnecessary offices or officers; no complication of business by means of signs and symbols; and no waste of time or money in mere display: while in the latter the offices and officers are usually not only too numerous, but too frequently changed; there are often absurd and wasteful forms and ceremonies kept up, and in too many cases large sums are extravagantly spent in processions, dinners, decorations, and useless paraphernalia. This is strikingly exemplified in the Manchester Unity. The total receipts of this association in 1844 were £325,200, 11s. 1d., and the total expenditure was £241,603, 16s. 9d., of which no less than £71,420, 16s. 4d.-or not much under one-third — was for expense
of management alone.
The safe investment of the funds is of primary importance to all friendly societies. Many have suffered severely, and others have been totally ruined by bad investments; but it is a cheering sign that every year witnesses an increase in the number of those who invest their funds in the savings' bank. On 20th November 1828 the amount held by the Commissioners for the reduction of the National Debt belonging to friendly societies was £142,118; in 1838 it was £952,768; and in 1848 it had increased to £2,003,435. The interest allowed on these deposits, as specified in the Friendly Societies' Act of 1850, is 'twopence per centum per diem,' or a little more than 3 per cent. per annum.
There is great reason to hope that the future of these societies will wear a brighter aspect than their past. Sad experience has taught many a bitter but salutary lesson ; and the recent legislation on the subject will
, as far as legislation can, prevent the recurrence of many of those evils that have destroyed society after society!
Of the important advantages of life insurance very few of the workingclasses have availed themselves. It is true that in many, if not in all the friendly societies, a payment is made on the death of each member; but this sum is usually so small, as to do little more than cover the funeral expenses ; beyond which it is of little material benefit to the widow or children of the deceased. A personal visitation was made not long ago of the families, chiefly of the working-classes, in a district in Manchester, and it was found that in only a few instances had the subject of life insurance been ever seriously considered; while in a great number there existed either prejudice or indifference, and in others the subject had never been heard of at all. This ignorance could certainly not be charged against the insurance companies; for many of them have employed agents to diffuse in every possible way, by lectures and otherwise, information on a topic in which every man of the community is deeply interested. It has been estimated, though we are afraid on imperfect data, that the number of lives insured in the various offices of this country is only about 250,000, and the amount £150,000,000. And yet if we consider the process of thought through which a man must pass, and the principles by which he must be actuated previous to insuring his life, this number will not appear so very small. The majority of the investments of money are purely selfish: the invester expects from them some great gain or gratification to himself, and that he will live to enjoy the fruits they are expected to produce; but the insurance of a life is, in ordinary cases, a purely disinterested act: the insurer himself derives no benefit ; and it is only in the event of death that the insurance is useful. So long as man remains the same selfish, avaricious, ambitious creature he has been for the last six thousand years, so long will he prefer his own present gratification to the happiness of posterity, and so long will the adoption of the principles of life insurance make slow progress.
And yet, if the working-classes of this country would but exercise sufficient prudence and self-denial, how soon could they, to use their own language, 'emancipate their order.' If effected at an early age, say twentyfive, a man may for about 9d. a week insure his life for £100. Let him drink a few glasses of ale less every week, and the thing is done. In the one case he has the ale, which very likely does him harm instead of good; in the other his deathbed is rendered calm and peaceful by the reflection that he leaves his widow and family provided for in so far as his exertions and means will allow. In the one case he has to look on death as a dire calamity, that may bring poverty, and destitution, and pauperism; in the other as an event for which he has provided, and on which he can look with a serene eye.
The forms under which life - assurance companies present themselves are numerous and varied. The simplest is that where the company agrees, on payment of a certain sum per annum by the assured, to pay a certain amount to his heirs or assigns at his death. The yearly rates vary, according to the prospect the assured has of long life-that is, according to his age and the state of his health. Thus a man in good health at the age of twenty-five may insure his life for £100 on paying yearly about £1, 17ş. 6d., or somewhat less than 9d. per week. Few of the companies, however, receive payments otherwise than yearly, though some receive them quarterly; and in the case referred to the quarterly sum would be 9s. 9d. Suppose the assurer were to live to the age of threescore-and-ten, he would have paid in yearly premiums much less than the sum for which he had insured. But he has no guarantee that he will live any number of years after the insurance has been effected: an attack of some contagious disease, such as cholera or fever, may carry him off before he has made a second payment, but nevertheless the amount to which his heirs are entitled is the same. This constitutes the peculiar value of life insurance, apart altogether from its value as an investment. The records of many of the companies for the year 1849 demonstrate the great value of the system. It will be remembered that during that year the cholera made fearful ravages among the population; and many cases occurred in which the widows and orphans of those who fell victims to this dire disease were well provided for by insurance policies on which only single premiums hadi been paid.
In some cases also persons have been known during that year to express a wish to insure, and to have actually taken the preliminary steps for that purpose, when they were cut down by the disease before their object could be effected. It is also a curious fact that, as a general rule, persons whose lives are insured enjoy more than the average duration of life. This may to some extent be accounted for by the fact, that men who are so careful in providing against death will be equally so in preserving life; but some influence must also be ascribed to that calm and serene feeling which the effecting of a life insurance must necessarily create.
Another form is that in which the assured obtains a share in the profits of the company. For this he has of course to pay a higher premium; but as the company prospers ----and few insurance companies have not been prosperous--he obtains either considerable additions to the amount of his policy, or reductions in his yearly payments. Insurances can also be effected for the payment of a certain sum at a certain age. Thus a man at the age of twenty-five may, by paying about £4, 16s. annually for ten years, entitle himself
, at the age of thirty-five, to receive £100. If, however, the assured should die before reaching the specified age, the company are not liable ; but if the insurance be effected according to another and a higher scale, the company are liable to pay the amount, no matter at what age the assurer should die.
Our space will permit us to specify only two other forms of life insurance that have been recently introduced. Men of property have for many years been in the habit of insuring houses, &c. from fire, and ships from wreckage, but it is only within the last few years that people have thought of insuring themselves from accidents. Houses will be burnt, ships cast away, and people killed and wounded accidentally, even when insured ; but the insurance is certainly a great mitigation of the calamity; and even when no calamity occurs, few people consider the money so invested as absolutely thrown away. Since the construction of railways the number of travellers has immensely increased ; and however well managed railways may be, those who use them will be always more or less exposed to some risk. Many widows have been left destitute and many men rendered helpless for life by railway accidents which no penetration could foresee, and which no prudence on the part of the sufferers could prevent. To meet such cases &