ON LIFE INSURANCE AND VITAL STATISTICS. 
279 
premium — a practice which general experience appears to indi- 
cate to he both inefficient and unsatisfactory. 
There are companies which undertake special assurance 
against accidental death, in contradistinction to natural causes; 
and here subtle questions have arisen, to show how difficult it 
is to give any law a general application. Accidental death, in 
medical language, signifies mortal effects, produced by a blow, a 
fall, poisoning, suffocation, or by violent and sudden means. But 
legal difficulties not unfrequently arise, in contesting the nature 
of death resulting from sunstroke, lightning, exposure to cold 
and privation after or during shipwreck. 
Companies are exposed to all kinds of frauds. It may be gene- 
rally supposed, that a man has an interest in preserving his own 
life ; but experience has plentifully shown, that life assurance 
contracts have been deliberately entered into, with a view of 
securing for their family that provision which they believed 
themselves incapable of obtaining by the usual and legitimate 
mode. Numerous instances illustrate the importance of making 
a very exact official inquiry as to the cause of death, when it 
appears to have been sudden and unexpected. A coroner’s in- 
quest is usually a sufficient proof as to the cause of death ; but 
its verdict is not binding on any company, and when good rea- 
sons have existed for suspecting fraud, facts now and then come 
to light that show the death to have been brought about by 
poisoning, either accidentally, or from suicidal motives. In- 
teresting medico-legal questions, belonging to these cases, em- 
brace the many forms of homicide, suicide, and insanity. The 
practice, therefore, of making policies indisputable or un- 
changeable , after two or three years, adds much to their mer- 
cantile value ; for, where fraud, by duelling or suicide, has been 
meditated, the claims are early, whilst, in ordinary life policies* 
several years elapse. 
It frequently happens that a life assurance office meets with 
failure. Such a misfortune, however, could never occur under 
a prudent management. A guarantee fund need not be large ; 
but a provision should be made for rent, salaries, advertising, 
and agency, or the expenses will otherwise consume the whole of 
the first, and probably, much of the second year’s income from pre- 
miums. In a short period, however, the management expenses 
ought to bear only a proportion of 2 to 5 per cent, on the pre- 
miums, leaving, therefore, a sufficient margin for profit ; for, as 
we shall have to show, a charge, or loading, is added to the net 
calculated premiums of not less than 20 per cent. There are, too, 
circumstances that cause the disruption of a young office, or ne- 
cessitate its amalgamation with a more successful rival. In the 
first place, mismanagement, and an extravagant expenditure, 
with or without an adequate guarantee fund, may do it ; in the 
