Chase.] 148 [ April 3, 



SA7IXG-FUND LIFE-INSURANCE. 



By Pliny Earle Chase. 



(Bead before Ihe American Philosophical Society, April ?>d, 1874.) 



Elizur Wright, the eminent Actuary and formeiiy Scats Commissiouer 

 of Life Insurance for Massachusetts, has proposed a combination of 

 Saving Fund and Life Insurance, to dispense with the extravagant com- 

 missions of canvas lers, and with other enormous expenses incident to 

 the present competitive system. If sufficient business could be secured, 

 there caii be no doubt that such a combination would work admirably. 

 In order to float a company until a paying business is established, Mr. 

 Wright proposes to start with a capital of $500,000. 



But capitalists are timid in regard to untried enterprises, especially 

 when it is proposed to enter a business field without resorting to any 

 of the customary methods for inviting business. It may, therefore, be 

 well to inquire if there be no other way, in which some analogous ex- 

 periment may be tried safely, cheaply, fairly, beneficially, and in every 

 way satisfactorily. 



Life Insurance is the safest of all kinds of underwriting. The risks 

 are known with greater certainty, the contingencies of extraordinary 

 misfortune are fewer, the naargin reserved for unforeseen calamities is 

 moi'e liberal, and the interest of the beneficiary in guarding the risk is 

 greater, than in any other of the many forms of ijrotective insurance. 

 The only case in which a guarantee capital would be of any advantage, 

 is when heavy losses occur before sufficient accumulations have been 

 provided to meet them. 



Saving Funds, notwithstanding their occasional failure, have long 

 been, and will doubtless continue to be, more popular than Life Insu- 

 rance Companies. They require no ex^jensive corps of agents or can- 

 vasser?, and but little advertising, especially if the interest of the benevo- 

 lent can be enlisted in their behalf. This may be easily done if other 

 advantages are added to those of an ordinary Savings Bank, and es- 

 pecially if the depositors and friends of the Institution can be brought to 

 feel that the money can be withdrawn in case of pressing personal 

 necessity, while, in case of early and unexpected death, the bereft family 

 will be specially benefited. The proper way, therefore, to inaugurate 

 the proposed experiment, would seem to be, to add new inducements to 

 a system that is already cheap and popular, rather than to enter into the 

 field of direct competition with the cumbrous and expensive organizations 

 and appliances which have been thought necessary for the successful 

 working of a system that is costly, and, in many respects, unpopular. 



In order to secure such added advantages as I have suggested, I submit 

 the following outline of a plan, which may, perhaps, be so modified by 

 hints dei'ived from the study or experience of others, as to be deemed 

 worthy of practical trial. 



1. Credit all depositors with four per cent, simple interest, and give 

 them the right to draw upon their accounts, either under the usual re- 



