INSURANCE IN PRACTICE. 



BY OSWALD J. ARNOLD. 



[Oswald James Arnold, secretary of Illinois Life Insurance company; born Rochester 

 N. Y., Oct. 2, 1872; graduated from the University of Chicago, 1897; on leaving college 

 entered the service of the Illinois Life Insurance company as private secretary to the 

 president; appointed agents and solicited life insurance, and later became assistant 

 secretary, and then secretary of the company; he is also director of two Chicago 

 banks.] 



It is a novel statement for the average investor in a life 

 insurance policy to be told that on the issuance of that policy 

 to him, the insuring company would be quite satisfied to take 

 his premium payments in a lump sum, with proper discounts 

 for cash, as to receive it without discount in twenty payments. 



Life insurance perhaps appeals strongest to the man who 

 is married, and who all at once is presented with the question 

 of what will happen to his family in case of his sudden death. 

 Perhaps at 35 years old this question assails him, and he an- 

 swers it by taking out a policy. At the time he may have 

 $1,000 in cash in a savings bank at 3 per cent interest. From 

 this $1,000 he takes just enough to pay the premium for one 

 year on a twenty year endowment policy, leaving the balance 

 at simple 3 per cent in the savings bank. Here, then, is his 

 position between the savings bank and the life insurance com- 

 pany: - 



To have left the $1,000 in bank at 3 per cent interest, 

 wholly undisturbed for twenty years, the compounded interest 

 at the end of the period would approximate another $800, mak- 

 ing a total of $1,800. 



But in taking $43.32 from the $1,000 in the savings bank 

 and applying it as a first annual payment of the twenty pay- 

 ments to be made in the next twenty years, the 3 per cent in- 

 terest on the remaining $956.68 almost will cover the fixed pre- 

 miums on the policy for the nineteen years. At the end of the 

 twenty year period of the endowment policy the holder of it, 

 having paid out only $866.40 in that period, will receive his 

 guaranteed $1,000, having been insured in all those years 

 against death in any form. Or should fate have interposed in 



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