Valuation of the Life Liabilities of the Royal Insurance Company
for the Quinquennial Period ended 31st December, 1864. By Percy M. Dove, F.S.S., Actuary. (Truscott and. Son.) This report shows a very extra- ordinary rate of progress in the practice of insurance, under the form of the wonderful increase in the business of a particular society, and that a comparatively young society. The life-insurance premiums of the last five years of the Royal Insurance Company have exceeded by 63 per cent. the life-insurance premiums of the first fifteen years . of its existence,—the latter (the premiums of first fifteen years), having amounted to 332,973/ against an amount of 543,0251 in the last five years. The sums assured on the policies of the year 1864 alone amounted to more than that assured during the ten years from 1854 to 1864 inclusive,—the amount insured being 1,014,8971., and the premiums thereon, 32,7081. A bonus of 21 per cent. per annum has been added to the original sums assured by every par- ticipant who had taken out his policy before 1st January, 1863, for each year that the policy had been in existence since the last declara- tion of bonus. The report, besides showing this extraordinary increase of business, due, probably, to the general increase in the habit of insurance, has some very curious facts about "the declined lives," the mortality
amongst 1,914 of which has been traced and verified after much trouble by the company. The result is as follows :—
"At age thirty-five, one out of one hundred and twenty-one of accepted assurers died, whilst one out of forty-seven of the rejected died. In the same way, at age forty, one out of thirty-six of the latter, and only one out of one hundred and forty-three of the former, died. If, taking the same intervals of ages as in the comparison of the unadjusted and adjusted numbers of the lives accepted at page xxxi, we contrast the per-centage of deaths between the accepted and declined lives, we show the following result :— Agee. Accepted Lives. Decline' Lives.
18 to 37, per-centage of deaths .763 2.38
38 „ 4411 .991 3.23 45 „ 5427 1.596 3.91 _.628 6.51
It further appears that out of these 1,914 lives, part of the total number of 2,381 rejected in the last twenty years, no lees than 250 have died ; while, by the same test which has been applied to the accepted lives, only 111 would have been expected to die. The total claims which would have been made on the company, if it had injudiciously accepted those lives, would have been no less than 146,4601 3s., whilst, if a mor- tality had prevailed among them not greater than the adopted theory of the company would indicate, the claims would not have been more than 65,8761" Could these declined lives " but be traced by all the insurance com- panies, we might soon have a reliable table for invalid lives.
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