Democratic Sentinel, Volume 4, Number 13, Rensselaer, Jasper County, 7 May 1880 — CO-OPERATIVE LIFE INSURANCE. [ARTICLE]

CO-OPERATIVE LIFE INSURANCE.

A Western Official Opinion. Hon. T. B. Needles, State Auditor, and Insurance Commissioner for Illinois, speaks as follows upon the subject of assessment life insurance: State or Illinois, Auditor’s Ornes,) Sprinofield. April 20. f In my judgment co-operative life insurance, as offered by the various mutual-aid societies now in operation, is unsound and fallacious, full of errors, and sure to bring disappointment and loss to those who trust to its protection. When the benevolent feature is attached t<> secret societies and organizations in which there are other and paramount interests to bind the members together, it may no doubt be productive of great good in rendering assistance in misfortune and relieving the families of de ceased members; but this cannot take place or perform the office of life insurance proper. The independent co-operative societies, however, do not possess even this element of cohesion. They are money-making concerns, intended to benefit their originators, officers and managers, while their real object is dsiguised under various benevolent and mutual-aid titles. Their membership consists of persons who have no community of interest, who are not acquainted with one another, who are not actuated by benevolent motives in joining or paying assessments, but who are governed solely by self-interest. The bond of union is so weak that, should the societies fail to fulfill the large promises of their agents, should the mortality increase and the assessments multiply more rapidly than was anticipated, and the members find that it did not pay to remain and there is no loss attending withdrawal, they will drop out in large numbers. The indefiniteness of the contract, the misrepresentations and large promises of agents, and the uncertainty of benefits in case of death, depending upon the voluntary contributions of an uncertain number of are productive of dissatisfaction and disappointment. There are not the benevolent considerations which exist in various orders, societies and brotherhoods to hold th< members together, and these societies do not have the obligations of a definite mutual contract, as in regular life insurance companies, to compensate them for withdrawals. The success of these societies cannot be. predicated upon the experience of a few years. The rate of mortality changes from year to year. The average age of the members advances, and cannot be offset by the accession of new members ; and, in consequence, the rate of mortality is certain to increase. The assessments for death losses soon become a burden which the members, disappointed in their expectations of cheap insurance, will no longer bear. Those who are insurable will withdraw and seek insurance elsewhere. Those whose health has become impaired, and who are no longer insurable, will be compelled to remain or forego the benefits of any kind of insurance. The result is, the insolven cy of the society, and irreparable loss to those who are most in need of insurance. Without interest income, guarantee capital, or accnmu lated reserve, these associations cannot fulfill their promises of cheap insurance and large benefits. I do not regard these associations as fit to be compared in point of responsibility and likeh hood of fulfilling their agreements with the organizations founded upon the scientific ap pheation of carefully-collected statistics, whose ability to pay the last surviving policy-holder remains, should all the others withdraw. I have no statistics to enable me to determine the relative cheapness of the two plans, for when the element of certainty of lienefits is wanting, as in the case of co-operative life insurance, it is valueless, and I consider it dear at any price. I cannot see wherein there is less opportunity for dishonest management in this system than in that of regular life insurance, while I believe, as a fact, they have been managed with less honesty. T. B. Needles, Auditor, etc.

Nigh Unto Death. One day a mother who had been to a country house, near Marseilles, returned with her son to Marseilles. It was twilight. The child, 8 years old, had been put into a peach basket, borne by a donkey, and the mother, fearing the child might catch cold (it was in November) had covered the boy with a thick brown shawl. Tired with running around the country all day, cozy and warm under the thick shawl, the child was soon asleep and hidden by the sides of the basket. Although the city gates were neared (there is a local custom house at the gates of Marseilles), the mother, forgetting all about the child, walked a distance behind the donkey and did not make him stop at the custom house to be searched. The custom officer seeing the donkey jog on without stopping, suspected he was laden with smuggled goods and ran after him to thrust his sharp steel probe through the basket. Luckily the mother observed him, ran forward and screamed: “Don’t use your probe! My child is in that basket!” That child Thiers.