AGKICULTUKAX ACCIDENT INSURANCE 4I 



ceases working, and heirs of deceased members, receive ^/g of the credit 

 balance of their share in the reserve fund. 



Policy holders leaving the societies for other reasons than those we 

 have mentioned have no claim to the credit balance of their reserve fund 

 account : it belongs to the society. 



Let us make this clearer by an example. Let us suppose that one of 

 these societies annually receives 500,000 frs. in premiums. A policyholder, 

 A., has paid a premium of 50 fr. His reserve fund account is kept by the 

 society and credits and debits to it are entered in the books. Let us suppose 

 that the accounts for the first year are closed with a balance of 100,000 fr. 

 This is 20% of the total premiums collected; therefore A's reserve fund 

 account will be credited with 10 francs. If another year the profits are 

 200,000 fr., 20 fr. will be placed to A's credit. If one year there is a loss 

 of 100,000 frs., it is taken from the reserve fund and 10 fr is entered to 

 the debit of A. and so on. 



If A. leaves the society under the conditions contemplated, for 

 example, because he has given up his farm, he must be paid *l^ of the credit 

 balance of his reserve fimd account. A's heirs will receive the same amount 

 at his death. 



In connection with reserve fund shares, there is another provision in 

 the rules of one of these societies to which we must draw attention. It 

 is provided that when the reserve fund reaches the limit fixad 

 by the board of management, the whole of the profits for the year shall be 

 repaid. According to the reports of this society, the Board of Management 

 has decided that these refunds shall commence to be made when the credit 

 balance amounts to twice the premium. In the case of our policy holder 

 A., who has annually to pay a premium of 50 fr., when the credit balance 

 of his reserve fund account is 100 fr. nothing more will be entered to his cred- 

 it, but the amount which should be assigned to him each year out of the pro- 

 fits will be deducted from the annual premium he has to pay. If, therefore, 

 there was a gain of 100,000 francs on the total premiums of 500,000 fr., in- 

 stead of 10 fr. being added to A's credit it would be deducted from tha 

 50 fr. premium he has to pay. 



§ 3. The results of experience. 



Since the law has been in force for eight years (it came into operation 

 on July 1st., 1905), we are able to arrive at some valid conclusions. We 

 shall above all consider the results obtained by the Caisse Commune d' Assu- 

 rances des CuUivaieurs Beiges and the Assurance Agricole, since these two 

 mutual insurance societies undertake most of the agricultural risks in Bel- 

 gium, and regularly furnish detailed statistics in their reports. 



During the debate in ParUament, it was repeately said that the applic- 

 ation of the law to agriculture was less necessary as agriculture did not 

 present very serious dangers. The experience of Belgium is quite contrary 



