SOME DOUBTS ON INSURANCE
[To the Editor of THE SPECTATOR] Sur,—For many years now I have read the very inter- esting Insurance Supplements in The Spectator, and have been struck by the oft-repeated wonderment expressed by such writers as Mr. C. R. Toogood as to why we are an under-insured nation (compared with America) or why some are not insured at all. But what has struck me most over this period is that the reasons never seem to enter the heads of such writers, although they must have been driven into insurance canvassers thousands of times. •
After such a long spell I feel I must attempt to state the obvious. A potent reason with people of my own—the lower middle-class—is the fear of being out of work for long periods, when, since we are not State-insured, what cash is in hand must at once be drawn upon and premiums abandoned. In reply to the query, Surely Insurance must come first ? " fear it must come a bad last to such claimants as food, land- lords, rate-collectors and school fees. Consequently, the leeway is never made up.
So much for one reason. There are countless others, such as the stringency of the medical examination and the frighten- ing queries of the " Did your great-aunt ever have a stroke " -type, as if one's relatives must be immortal before a company condescends to accept a premium.
Finally (for reasons of space only) sonic of us find that the alluring claims " He paid £60t) and got £1,600 - do not always work out like that. I am insured for a specified premium for a specified sum at death with a well-known Company. I now find that I must die by 53 or I shall have paid in premiums in excess of the sum my dependants are to receive. Otherwise, the premiums must go on, and I may live until I am seventy ! So in reply to the advertised question. " What investment can show such returns as Life Assurance ? " some of us must reply with gusto, " Hundreds ! '*—Yours faithfully, Novo CASTRIA.
[Mr. Toogood writes : The statement made by " Novo Castria "that the fear of unemployment deters a man from effecting Life Assurance is true in a-number of cases, but in no way excuses the failure to take out a policy. On the contrary;" the adverse possibility instanced constitutes one of the reasons why such a contract should be entered into, simply because it is capable of coming to the rescue at times of misfortune. How gratifying it is to know that, if need arises, there is a Life Assurance Policy to fall back on, which will enable a man immediately to adopt one of the following alternatives : (a) Obtain a loan at a nominal rate of interest ; (b) Surrender bonus additions for cash ; (c) Cease paying premiums and take an assurance for a reduced amount ; (d) In extreme circumstances surrender for cash. A man's duty is to provide for his dependants, not merely so long as he lives, but so long as they live. In the event of
the death of "breadwinner," money for food, rent, rates and school fees will still be required, and there is every justift-
cation for providing accordingly. This can be done only_hy_ Life Assurance, the premiums for which, it is _again most definitely contended, should occupy a place of prominence .in the family budget.
Life Assurance is available to the majority. Comparatively few are ineligible on medical grounds. The expression " first- class life " is used by Assurance Offices to denote the average, normal, healthy person. As the premiums for Life Assurance (Ordinary Branch, not Industrial Branch) are calculated from mortality tables of selected lives it follows that acceptance must be limited to a similar body of lives.
In the absence of full details of the particular policy referred to by your correspondent, it is impossible to offer any explana- tion to him ; otherwise a convincing reply might be made.]
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