CHAMBERS'S INFORMATION FOR THE PEOPLE. 



for every week of sickness, or of is. 3d. for every 

 day of sickness, except Sunday. __ These tables wil 

 furnish a tolerably fair idea ' of the payments 

 necessary to secure certain specified benefits. 



WEEKLY PREMIUM TO INSURE PAY IN SICKNESS AT THE RATE 

 OP SEVEN SHILLINGS AND SIXPENCE A WEEK. 



It is essential to the character of a proper 

 benefit society that individuals be not admitted 

 indiscriminately. To take in a person in bad 

 health or of broken constitution, is unjust to those 

 members who are healthy, because he is obviously 

 more likely to be a speedy burden to the funds. 

 Here, as in life-assurance societies, it is necessary 

 to admit members only upon a showing that they 

 are of sound constitution and in the enjoyment of 

 good health. And it may be well to grant no 

 benefits until after the member has been a year in 

 the society. By these means, men are induced to 

 enter when they are hale and well, instead of 

 postponing the step until they have a pressing 

 need for assistance, when their endeavour to get 

 into a benefit society becomes little else than a 

 fraud. 



Government Registration. 



Government has thought proper to interfere 

 with its aid in the formation of friendly societies, 

 though not compulsorily. An association of per- 

 sons forming a friendly society has the means 

 of ascertaining the soundness of its principles, and 

 also entitles itself to deposit funds in savings- 

 banks, with the government security, and at not 

 less than ^3, os. xod. per cent per annum, by 

 submitting the proposed rules to the barrister 

 appointed to certify them, to whom a fee of 

 a guinea is payable. Under the sanction of 

 government, tables were formed by the late Mr 

 John Tidd Pratt, Registrar of friendly societies in 

 England, and also by Dr Farr, the Actuary of the 

 English Registrar-general the former, together 

 with useful instructions in the book-keeping of 

 friendly societies, are embodied in the Reports by 

 Mr Pratt, printed by order of the House of Com- 

 mons for the years 1856-57; and the latter, to- 

 gether with a masterly essay on the mathematical 

 treatment of the subject, are contained in the 

 twelfth Report of the Registrar-general, previously 

 referred to. On the imperative necessity of acting 

 on correct tables for such a purpose, it would be 

 superfluous to dwell ; and the necessity of identi- 

 fying the rates of any society with such respon- 

 sible authority is the more advisable, as Mr Pratt 

 repeatedly explained that the ' duty of the regis- 

 trar in examining the rules of a friendly society 

 is confined to the consideration of their being in 

 accordance with law and the provisions of the acts 

 in force relating to such an institution ; and that, 

 although the registrar certifies to the legality of 

 the rules of a friendly society, it does not follow as 



518 



a necessary consequence that the constitution of 

 the society is based on good principles, or that the 

 rates of payment are sufficient in amount to 

 guarantee the promised benefits and allowances.' 

 The Rev. John Pratt, son of the late Registrar of 

 friendly societies, states that his father received 

 hundreds of letters from members of bankrupt 

 friendly societies, who stated that they had joined 

 them, because of seeing his father's name attached 

 to the rules. They could not understand that 

 registration did not afford a guarantee of a society 

 being based on sound principles. 



Principles of Friendly Societies. 



It is to the general ignorance of the principles 

 necessary to insure the successful working of a 

 friendly society, that we must attribute the fre- 

 quency with which associations of a dishonest 

 character are projected by designing men. The 

 only remedy, apart from that furnished by the law, 

 is to diffuse correct information upon the subject 

 among those who stand in need of it We can 

 form an idea of a benefit society in its simplest 

 form, if we suppose a hundred men, of exactly 33 

 years of age, to associate, and make such a pay- 

 ment at first as may be sure to afford each man 

 that shall fall sick during the ensuing year one 

 shilling a day during the term of his sickness. 

 Taking, merely for the sake of illustration, the 

 Scottish Tables, we find that, amongst such a 

 body of men, there will be about 66 weeks of ill- 

 ness in the course of the year. This multiplied 

 by 7, gives the whole sum required, ^23, 2s., or a 

 little more than 45. 6d. each, which, less by a small 

 sum for interest, will accordingly be the entry- 

 money of each man. A society of individuals of 

 different ages, each paying the sum which would 

 in like manner be found proper to his age, would 

 be quite as sound in principle as one on the above 

 simple scheme. It is only a step further to 

 equalise each man's annual payments over the 

 whole period during which he undertakes to be a 

 paying member. 



A point for consideration, however, is the rate 

 at which the funds of the society may be im- 

 proved. In most cases, we believe, it is best for 

 such societies to rest content with taking advan- 

 tage of the privilege which they enjoy by act of 

 parliament, of depositing their money in the funds 

 or the savings-banks, in which case they are sure 

 to obtain for it interest at a rate of not less than 

 , os. lod. per cent, per annum. 



Proceeding upon these or nearly similar grounds 

 of calculation, Dr Farr suggests the following plan 

 for insuring lives and granting pensions to the 

 classes who live on wages, by combining the pro- 

 vision for insurance payable in a sum at death, 

 and for annuity to begin at the age of 65. This 

 union deprives the two operations of their chief 

 risks, and there is little loss by the lives being 

 better or worse than the average. The policies 

 of insurance and annuities can be easily valued 

 every year. It would be necessary to add a little 

 :o the premiums for expense of management and 

 for fluctuation in interest and values of public 

 securities. The plan is so constructed that the 

 annual premium is invariable, that depositors can 

 at any time discontinue their premium and with- 

 draw their deposits, without invalidating or dimin- 

 shing the amount of their policy, or that they 

 can leave the sum in the guarantee fund as an 



