Open main menu

Page:Popular Science Monthly Volume 19.djvu/651

This page has been proofread, but needs to be validated.
633
MODERN BASIS OF LIFE INSURANCE.

While the two experience tables are very similar, and represent about the same social conditions, the well-to-do middle classes, in this country and in England, the American table has a peculiarity characteristic of life in the United States. At the younger ages, up to thirty years, the mortality is greater, while from thirty to seventy years it is somewhat less than in England. During this latter, the most active period of life, the strain upon the system is very great in this country, and the vital forces are used up to such an extent that after seventy years the death-rate rises rapidly. The table ends at ninety-five, while the English is carried to ninety-nine. It may also be mentioned here that female life has proved less favorable than male life to insurance companies, while it will be remembered that the very reverse has been observed in the community at large. The next point that will attract attention is, that the English life table, representing the average life of the whole population, does not range so much above the insurance tables as might be supposed. Insurance companies select only healthy individuals by medical examination, and almost exclusively from the better classes and occupations. Why, then, is the difference not greater? Some of the reasons can be readily given. First, there is a constant effort on the part of the public to foist impaired lives upon the insurers. No amount of care or precaution can detect all misrepresentation or trace every inducement to fraud and self-destruction, and, while it may amount to less than some assume, it undoubtedly reduces the standard of absolute health. Of far greater importance is the observation that the effect of selection nearly wears away in about five years. Taking a class of live? selected by medical examination, say at twenty-five years, it will show a reduced mortality during the first year; but after five years, at age thirty, very nearly the usual average is again reached. For, while the diseased are excluded from the selected class, a certain number of these sound lives will find their health to fail from year to year. Were those admitted at twenty-five years to be reexamined at age thirty, so many sick and ailing would be among them that the advantages of selection would be found to have largely disappeared.

Registrar-General Farr estimates 27 out of 1,000 of the whole population, between the ages of twenty and sixty, to suffer from some kind of disease or other, be it hereditary, chronic, recurrent, or acute. Consumption, he thinks, though varied in duration, seems to average about two years. The higher the age, the greater the value of selection; and, the older the members of a life-insurance company become, the more do they approximate the health of the community at large.

Another factor that operates as a selection against the mortality experience is what is called lapses. A large number of policies are constantly allowed to terminate through the indifference of the insured, and for various other reasons. But, while the healthy often forfeit