INSURANCE IN PRACTICE 455 



From the mortality tables the death rate per thousand of 

 persons at each age is determined, as is also the average dura- 

 tion or expectation of life at each age. 



The American experience tables of mortality, for instance, 

 can tell you a good deal more about your chances of life at a 

 given age than you can hope to get from the astrologist, palm- 

 ist, and others of the cult. Dropping the decimal portion of 

 these tables, the foregoing abstract will show your chances of 

 dying from any or all causes as compared with 100 other per- 

 sons of your age who may be in health to invite insurance risks. 

 As a key to the reading, take the 10 group at 40 years old, and, 

 looking across to the end of the forty year period, it will be 

 seen that eighty one of the original 100 will be dead. 



Having established the deaths in this proportion from the 

 first year of the policy's issue to the age of 96, at which age it is 

 assumed that the last man out of a given 100,000 starting at 

 the age of 10 will die, the insurance company is ready to nego- 

 tiate with you at any of these ages on the basis of a fixed annu- 

 al premium for any kind of policy which you may choose to 

 take. There are four of these policy forms in general use. 

 The simplest and cheapest of these is the term insurance policy 

 — usually for five or ten years — in which fixed terms the pay- 

 ments in those years provide for the payment of the death 

 claim, should death occur within the period specified in the 

 policy. 



The ordinary life policy ranks second in the amount of pre- 

 mium to be paid annually until death at whatever age. On 

 this form of policy premiums are payable during the whole 

 penod of life. 



The limited payment policy practically is the ordinary 

 life policy, only that an equivalent of the premiums which 

 would be paid during the ordinary term of life, according to the 

 mortality tables, are paid within a specified time. 



After these the endowment policy, for ten or twenty year 

 periods, offers the insured the return of the face value of his 

 policy if at the end of ten or twenty years he shall be living to 

 claim it. This is the form of policy which is comparable in its 

 benefits with the savings bank's interest at 3 per cent com- 

 pounded semiannually. 



