Daily press. [volume], December 28, 1906, Page 5, Image 5

About Daily press. [volume] (Newport News, Va.) 1896-current

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OUR WATCHWORD: "First, last and ail the time, a business in every respect beyond reproach.'1
"The Company OF the People, BY the People, FOR the People"
Review of 1906 and Announcement for 1907
Bulletin No. 475 ?New York, December 8th, 1906
To the Field Force:
GENTLEMEN:
It is our custom to address you each year at the time
of out annual Superintendents' Convention. Usually
Hiis is held about tho middle of January, and the
topic or tho BULLETIN is naturally tho Annual
Statement of the Company. This year the Super?
intendents meet in convention the middle of
December, and obviously the record of the year is
not mnde up, nnd it would be premature to set
forth the progress of the Company la Its business
nnd finances. We shall have something very pleas?
ant to say to you before we close about what you
have accomplished; but our immediate object is to
tell you about our plans for next year.
INDUSTRIAL DEPARTMENT.
You have known from numerous addresses, both
oral and written, what our ambition has been for
years in the Industrial part of our business. You
will boar us witness that our treatment of the policy
holders has been one of progressive liberality ever
since the present administration of the Company be?
gan. The very first year of its incumbency Paid-up
policies?theretofore unknown to Industrial insurance
in this country?were announced; and every yenr
since then something has been done for Industrial
policy-holders beyond any promise made In the poli?
cies. Bulletin No. 105 set forth these concessions nnd
bounties up to its date and since then the succes?
sive years have been marked by progressive gifts nnd
benefits offered to policy-holders; and thtB year the
Company has been disbursing the enormous sum of
about two million of dollars In voluntary dividends
upon non-participating Industrial policies; bringing
the total amount of unpromised dividends in twelve
years to about ten millions of dollars to Industrial
policy-holders in the form of dividends on premiums,
dividends on death claims and Increases of benefits
upon existing policies.
We have been enabled to accomplish this work
all these years by steady Improvements in business
methods, by steady extensions of business territory,
by steady additions to insurance in force, by watch?
fulness in writing and taking care of business, re?
sulting in a decreasing death rate, decreasing lapse
rate and decreasing expense rate. These Inprovc
ments we have announced to you from year to year;
but perhaps from this very fact?their gradual, steady
progresslveness?you have failed to grasp their full
significance. Yet year by year we have told you
our aim?to reduce expenses, to Improve the death
rnte. to better the policies, to distribute the surplus,
so that each year a larger proportionate amount
could be returned to policy-holders and a smaller
proportionate amount, used In expenses.
Within the last few years our disbursements for
death claims have been so continuously and marked?
ly less In, proportion to Income and our Improvements
In ratio of expenses shown so steady ah Improve?
ment, that we thought the time had come to make
a scientific reaurvcy. so to Speak, of the technical
features of the business. We have made investiga?
tions Into our mortality and drawn off Into various
periods our experience ol mortality. The mortality
tables upon which our present tallies arc founded
were taken from the experience of 1890-1894. A com?
parison of this with tables taken from the experience
of other periods has shown a steady Improvement in
mortality. In the case of children the result is really
startling. Take, for instance, age two next birthday;
Our present, table Shows -19.;! deaths per thossand; a
table 189G-1905 shows but 36.9; age three the figures
are respectively 32 and 24.3; age five 1(i and 9,S;
age ten f>.5 and 3.8. and this improvement runs
through the Infantile table. As to adults there Is
also a marked improvement.
These facts convince us that the time has come
to construct new tables of benefits founded upon our
experience of 1896-1905; and we are confirmed in our
conviction by the fact that a table drawn from the
years 1901-190!> shows a better experience than that
of the full decade. And it seems to us Just to base
these tables upon the experience of white lives; and
to give benefits based upon the Improvement, which
wo feel certain is permanent. How great this im?
provement is we illustrate by a few figures compar?
ing the table upon which our present benefits are
based with a table of white lives for the last ton
years. Deaths per thousand: age two next birthday
19.3 reduced to 3-1.7; age three 32 to 22.5; age four
21.5 to 13.2; age five 16 to 9.5; age ten 5.5 to 3 4;
age twenty 10.5 to 7.1; age thirty 15.7 to 11.1; age
forty 19.3 to 11.3. The other element besides mor?
tality involved in a table of benefits is of course the
expense. As you know, our ratio of expense to
premium income has been falling for some years:
ibis year the reduction has been phenomenal and
will reach, we think, by the end of the year, three
per cent.! This alone means a saving of nearly one
and a half millions of dollars! Wo shall show a
lower ratio of expense for 1906 than has beem ex?
perienced by any Industrial company In the world.
One other element goes Into the construction of
tables of benefits; and that is the. maturity of the
policies. When we made up our present table we
were convinced that the public was enamoured of
endowments. Our Industrial business has been is?
sued for ten years, as yon know, mainlv upon En?
dowment tables?Increasing Life and Endowment
policies nnd Twenty-year Endowments forming a
very largo proportion, in Bonie years over 00 per
rent., of our total business. One disadvantage of
ibis table lias been thai it largely Increased the re?
serve?. Our children's increasing Life ami Endow?
ment policies have been endowments payable after
periods of 17 years and upwards according to age
al issue. Compared with the Whole Life tables is?
sued by other cpniputiiGH these have made necessary
the a'/:umulatiou of an Increase of many millions of
dollars In reserve. Unthinking persons come to the
conclusion that this piles up the wealth of the Com?
pany, forgetting that along with the increase of as?
sets runs the Increase of liabilities, and that the
wealth of a cotnpamy consists in its surplus; and
completely overlooking tin remarkable fact that we
have deliberately kept down our BUlpltlS to about ten
per cent, of our assets by annual distribution* of the
excess of sulplus earned to the policy-holders who
contributed to it.. Public opinion has changed and
now cares more for denth benefits than endowments.
We art; In business to please the public. We have a
good deal of evidence that Ordinary Life and Limit?
ed Payment Life contracts are thought preferable to
Endowments. We have resolved therefore to discon?
tinue our Increasing Life and Endowment policies,
which were designed to meet the public demand
formerly existing, and which W?re, we believe, the
first tallies ever really scientifically constructed for
Industrial policies Our new Industrial policies will
therefore be Whole Life contracts. Hut we think that
as to these there are signs of a belief on tho part of
the public that payment of premiums ought to cease
with old age. it is hard for people to see what to
any mathematician is self-evident, that In life insur?
ance the companies are enabled to pay the policies
in full on lives- of those who die soon after Insurance
only by the receipt of premiums from
those who live out and beyond their
expectations; and that the apparent hardship
upon those who live long Is only the contribution to
the unfortunate which is the essential basis' of life
insurance. However, it Is possible of course to make
tables for limited payments, nnd the problem is
therefor."' to fix an age that shall not be so young
as to rnlse the premiums or (what Is tho same in
industrial Insurance where the unit Is the premium
and not the amount of Insurance) to reduce the bone
tits unduly; and on the other baud to fix the uge
not so old that the benefits of the limits of payment
of premium shall be lost. We have fixed age 75 as
the limit of payment of premiums because at that
nge we are enabled to only slightly reduce the bene?
fits during life, and because we have not received
many complaints of the necessity of paying premiums
1 up to that age. And to the occasional complaint
I that "people never live J.o such old age," we may
answer that In HiOil we shall have voluntarily, as
matter of grace, paid about 2,700 claims as Endow?
ments on policies Issued ns Whole Life on persons
reaching ago 80 after paying premiums for 15 years
or over.
Constructing a table of benefits upon these four
principles?Whole Life Instead of Endowments; our
recent mortality experience instead of our old; a
loading proportioned to our reduced expenses; and
Ihe payment of premiums ceasing after age 75?we
shall put forth for 1007 new tnbles in tho Industrial
department which are better than any company has
heretofore issued and better than we have ever be?
fore this felt It safe to issue.
The most striking change is In the infantile ta?
ble, because there we substitute Life tables with
payment of premiums limited to age 75 for our com?
paratively short Increasing Endowment tables now
in use; and are therefore enabled to pay In benefits
what we have beeil compelled to hold.as reserve
I liability upon the endowment features.
Our new Infantile tables will pay nearly as much
! In death benefits for a weekly premium of five cents
I as we have heretofore paid for a weekly premium of
ten cents. It is of course understood that the law
fixes a maximum of benefits payable upon children
nnd this we cannot exceed. We have therefore In?
creased the benefits at the later ages for persistence.
Thus at age two at entry the benefits in case of
deatli at age nine is $173, while the benefit at age
three at entry dying at age nine is $109 and the bene?
fit at age four dying at age nine is $165 and so on.
This Is a recognition of the additional years for
which premium'; have been paid by those entering at
earlier ages when death occurs at the same ago. It
follows from this large Increase of benefits for five
cents that hereafter no policy will lie issued under
the Infantile tables for ? total premium of more than
five cents. And to meet a desire for los:; Insurance,
especially in large fnmilles, we have a table with
I proportionate benefits for a weekly premium of
three cents.
Our Adult tables show an increase of benefits
! for the same premium based strictly upon our tallies
of mortality. At nge ten the increase is 12 1-2 per
cent, over our present Life table and nearly 18 per
cent, over our Increasing Life and Endowment table.
AI age 2d the Increase Is over nine per cent, nnd
over 2.". per cent, respectively; at age 30 the increase
in nearly six per cent, and nearly 2<> per cent, respec?
tively; at nge 4(1 the increase Is I wo per cent, and
I over 13 per cent, respectively, and so on. And in
comparing these tables with our present Whole Life
! tables (and with those of most of the other Industrial
1 companies) It must not be forgotten that those old '
tables provide for payment of premium during the
j whole of life, while under our new tableH payment of
! premiums ceases at age 76.
We have Increased the Immediate benefits tin?
der all of these policies lu accordance with the rule
we made retroactive this year, to half-bonoflts dur?
ing the first six months and mil benefits thereafter.
We have Introduced Into all of these policies new
loattiros in the way of surrender values. Paid-up
policies will he granted after three years Instead of
live; extended Insurance will he granted after throe
years at the option of the holder: and cash surren?
ders will he paid after ten years. The policies will
be In new and attractive forms, with three pages
Instead of two. In order lo set fortlt all of the eon
cessions, malting the rights of tin* policy-holders so
philn that any one will ho able to lell what ho Is
entitled to. And the whole contract will be express?
ed in the policy, doing away entirely with the neces?
sity of n Copy of the application, using tho form In
this respect for all policies which we adopted many
years ago for policies under J'too.
ORDINARY DEPARTMENT.
' One of the most striking results of the Arm?
strong Investigation was the adoption of a provision
restricting expenses lor the first year of the life
of the policy. And what is most Interesting
i as well as complimentary to the MIOTllOPOUTAN Is j
! the fact, which appeared lu the newspaper discussion
at the tinio of the adoption, of tho report and bills,
that this restriction by law was Justified by the ex
, perlener of this Company In the matter of expense
i us shown by an analysis of Its annual reports, It
is true that this Company kept its expenses nlmost
! within the limit prescribed by the new statute. Hut
the statute Is a ponnl one and we cannot run nny
I risk of over-running the limit of oxponse. This no
j cessllates a reduction of commissions, but tho rcduc
, Don will ue very much less than lhat made necessary
I by the companies Issuing participating policies. This
Company will not Issue after this year any other
than non-partlclputing policies. In fact, in the true
sense of the term we have not Issued any other* for
marly fifteen years; for. as wo have often explained,
the Intermediate ami Special CIubs policies were
based upon stock or a non-pnrtlclpatlng loading and
the dividends promised, if earned, wero expected to
I be derived from the mortality. Those policies were
entirely novel and we had little experience to guide
us. The Intermediate policies were based upon our
Industrial table of mortality and were designed for
Industrial risks who could afford to pay annual In?
stead of weekly premiums; and the mortality of such
n class could not be foretold. Tho Special Clans
policies were Tor sub standard risks as to Which the
mortality could not he accurately predicted. What
wo undertook to do was to pay hack to the policy
holders the gain from such Improvement In mortality
over the expected as should he actually OXporlenced.
As participating policies are based upon a higher or
so-called mutual loading out of which divi?
dends nre expected to be earned, we
claim that our Intermediate and Special Class
policies based upon n stock binding were In principle
non-partlclpatlng. All of our other policies in tint
Ordinary Department wore by their terms non-pnrti
clpatlng. The law has Justified us In the principles
we adopted fifteen years ago, and today the Arm?
strong laws and the similar ones prepared for other
Slates are n vindication of the MKTROPOLITAN
principles in which yon have boon (rnlncd. Wo have
now an experience of Intermediate and Special Class
risks which enable us to prepare iion-partlcipntlng
tables. The tables of premiums as to these policies
have heretofore been 'ompletely readjusted. Wo
think you will find them most attractive.
We realize that we shall henceforth hnvo more
competition in non-participating policies. Other
compnnies have announced their purpose to restrict
(heir issue to this form. We have therefore thought
it in your interest as well as our own and In the
interest of the public, which is superior to both, to
use n part of the reduction of commission to effect
some reduction of premium. New tables have been
prepared which we think will he attractive to our
riiHtoniers and which therefore will ho profitable to
you. In adjusting these commissions wo have"
thought it only just to restore to the Superintendents
an interest In them which we wero compelled to
withdraw a few years ago and which you will
remember, the Vice-president promised at the
I time lo icstore when we should be able
to arrange it And we have also recognized
I the good work of Assistant Superintendents by giving
them an interest in the work of their agents. We
I realize that the duties of Superintendents and AhbIsI
I tints Include the instruction and training of Industrial
agent* in the work of the Ordinary Department. Wc
want all of our agents to be all-around Insurance
men. Our Superintendents nnd Assistants have Im
j posed upon them as a dutv the supervision, tho con?
stant help and encouragement and the education of
their agents. We have made it an interest an well
ns a duty.
Our now policies will be found most attractive
5 in form and oven more attractive In substance. They
J contain all of the advantages and concessions which
I we can afford to give and which the public have a
right to expect. The surrender values will be
\
found to l)o generous and tnko the optlonnl forms ot
extended Insurnnco, paid-up Insurance nnd cash.
Thoy are tli? standard forms or the Now York Do.
purtniont, the work of exports which has loglslutlvo
approval. Thoy aro as plain to tho understanding as
they can he made. \Ve hnvo discontinued many
plana as nnneccHsary. We shall Issue Ordinary Life,
Limited Payment, (endowment and Term plans; and
we have applied for permission and hope to issue
In addition three plans which tho public have stamped
with their approval?namely, tho Optlonnl Lite or
Endowment, under u new name, the Modified En?
dowment with Life Option; the Guaranteed Divi?
dend, also under a new nnd more doncrlptlvn name,
tho Guaranteed Increased Endowment; nnd tho Re
duced Premium Life under Its now name, Life with
Reduced Premium after 20 Years.
Gentlemen, we are entitled to say that tho Arm
strong Investigation wnn a vindication of the methods
nnd practices of the METROPOLITAN LIPE. Tho
Armstrong laws nie In many respects a distinct
recognition ol the work WO have done together theso
many years. See that you npprucluto this fact to
the utmost. Show that you do by muking tho year
11)07 an unexampled year for the issue of more poli?
cies, for larger Insurance, for greater gain, for less
lapses and uot-taknns, at a loss exponse, at a greater
return to policy-holders than you have over dono.
Live up to your blessings! Show that you appreciate
the reward which the legislature has conferred upon
your good work of tho past I Make 1007 tho greatest
because the boat year In tho Company's history!
THI8 YEAR, 1906.
You have started well. Last year, the year of
the Investigation; you did tho largest huslnesH wo
had ever (lone. Tho first part of Ihla year tho pa?
ralysis which seemed, unreasonably and unuoodssar
II). to have fallen upon the business In general, ap?
peared to have affected even you?even more un?
reasonably and unnecessarily. Eluding this to bo
tho fact, the VIco-ProHldent. appealed to you In
personal conferences with the Superintendent? in
little groups all over the country; pointed out to you
the facts nnd conclusions of the Armstrong Inquiry
and tho results us embodied in legislation; showed
you the essential approval wo had received In our
work In both departments, anil naked you to respond
to all this for the remnlnder of the year by making
tlii> best, record you had ever made. This was In
May nnd June. It would be most ungrateful not to
make this public and general acknowledgement of
your response to the appeal, and on behalf of tho
Vleo-Presldent I give to you bis personal thankn and
tuld our official acknowledgements. The year Is not
yot ended and wo cannot therefore 1"ll ttfc "iinlr ,
story. Hut for tho months July to No'v?hwer, in
elusive, compared with the same months of previous
years :
You made the largest nmount of Industrial In?
crease which tho Company ever made, except In
1801 and 1903.
The agentH wrote the largest amount of Indus?
trial business, averngo per man, of any of the last
ten years.
Tho average Increase por man was larger than
for any of the past ten years.
The ratio of lapaeB was tho third lowest for ton
years past.
The number of transferred nccounts was tho low?
est, for eight years, notwithstanding tho larger
force of men with which we started and tho larger
reduction In the force we have made this year.
The collodions were the best In the history of
j the Company!
The death clnlms reached tho lowest ratio for
I the last 25 years?notwithstanding the Increased
average age of the policy-holders.
The special salary to agents averaged the largest
amount In the last ten yenrs; and yet wo saved
$100,000 In the total compared with last year.
The saving In total cost In these Items alonoK
medical fees the cause of a reduction in number ot
applications). Assistants' salaries and special salary,
was at the rate of a million dollars a year.
Wo may add that the Pacific t 'oast kept up with
the procession by the remarkable .feat of covering
for the year the enormous lapse caused by tho earth?
quake and Is cortaln to cIobo tho year with u hand?
some increase.
In the Ordiunry Department Scptomber about,
equalled September of last year, while,October and
November largely exceeded tho 'corresponding
months or last year, and December promises to be
a record breaker!
And taking the last six months for comparison?
June to November, Inclusive?you wrote more Ordi?
nary than ever was written by the Company In tho
corresponding months nnd exceeded 1005 by over six
millions nnd a hair; and this It must be remcmborod
by more than 3,000 less men!
We are proud of this record and we are grateful
to you for your generous response. We cannot say
more than to wish for you and yours the happiest
r.nd mcst prosperous year of your lives in 1007!
Very sincerely yours, ,
John R. Hegeman,
PRESIDENT. <
WILMINGTON, DEL,
SUFFERS FROM FIRE
Originated in the Boiler Room of a
Candy Factory and Does $350,000
Damage. ? {
WILMINGTON. DKL.. Dec. 27.? :
Fire early thin morning gutted four,
of the shopping district's largest
stores, entailing a loss of upwards of
l'tfjO.000. The destroyed buildings are
those of the Wilmington Candy Com?
pany. Louis Jacoby and the Leader.
The latter were dry goods stores. The j
Immense paint manufacturing estab?
lishment of .lames Bradford, In the?;
rear of the candy plant, was damaged .
to the extent of $5,000 by water.
Tho fire broke out at 4 o'clock in
the boiler room of the candy manu?
facturing establishment, and before
any of the firemen were on the scene
the four properties were burning:
fiercely. At one time the entire block
of department stores was threatened
with destruction. Tho firemen, how?
ever, kept the fire confined to the four
buildings. The owners of the build?
ings announce that their losses arc
only partly covered by insurance.
CONTRIBUTIONS DUE TUSEDAY,
Exploitation Commission Will Get
Down to Work Again 'After Holidays.
The Exploitation Commission will
hold a meeting one day next week
: and resume activities after enjoying
i tho holidays. The second half of
the subscriptions will be due on
i January i, and the subscribers to
I tho fund will he expected to make
lhe payments to Treasurer Wlllott.
! About $l.Sno is now in ihe treasur
! er's hands.
I The cut showing Uncle Kam step?
ping acros's Hampton Roads from
the exposition to Newport News hns
, arrived and is in the hands of tho
printer who has the contract /or
printing a large number of envel?
opes for the commission.
"Wasch" Flour leads all competit?
ors, making sweetest and best bread
and pastry. 12-25-lf
I
SALOON MEN ACQUITTED.
Byrum & Jones Found Not Guilty of
Selling to Minors.
In Hie police court yesterday
morning Byrum & Jones, Jefferson
avenue saloonkeepers, were acquitted
of the charge of selling liquor to
minors. Johnny flarrctt and Willi-"
Butler, twef youngsters who were
arrested Christmas Bye; for drunk
eness. testified against the accused,
but they could not Identify the man
who sold them the liquor, and their
statements were contradictory.
tMr. C. Aylott Ashby represented
the saloon keepers.
? - . ?_
Albano Coming.
The German steamer Albano is
due hero tomorrow from Hamburg
via Now York and Norfolk. Sho
will discharge several hundred ions
of Imports here before loading ex?
ports for Hamburg.
RICHARD JONES JAILED.
Husband of "Black Pattl" Turns Up
in the Police Court.
Kicnnrd Jones, tnc divorced nits
band or Misscrnttn Jone. ?mac"
Pattl," was in the police court yes?
terday .morning charged witn neing
drunk. lie was arrested Wednes?
day nignt as he was on nie war
to tne Academy ot .music to see nie
tormer spouse.
Some Uro ago the singer divorced
her nusinind and tor several years
no lias lived hero. Ho is now or
ployod at Pinn Beach. Each time the
Black I'.nltl Troubadours havo appear
ed at the Academy. Richard had
paid a call and haw been woll ro
eolved. but Wednesday ovoning he
fell Into an officer's hands.
Justice Brown listened to Rich?
ard's sorrowful tale and told hint
to go his way; that he had suffered
enough.
Rappahannock Clears.
The British steamer Rappahtuinoc'-.
j cleared yesterday for Liverpool with
ia large cargo of miscellaneous ??
| ports. Site has also 35'J head of
cattle aboard.