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Published online by Cambridge University Press: 18 August 2016
Among the numerous classes of risks now undertaken by Insurance Companies, those against the contingency of leaving issue are beginning, from their increasing numbers, to assume a position of greater importance than heretofore. Nothing has hitherto, to my knowledge, been written upon the subject, and the premiums for insurances of this nature have been left to the judgment of the actuary as each individual case has come before him, there being no recognized and accurate formula for the calculation of the risk. Under these circumstances, and as a considerable amount of material exists from which approximate results may be deduced, I venture to submit to the Institute a few considerations upon the subject, but confined principally to the probabilities of marriage so far as they affect the calculation of such premiums.
* The following passage, which occurs in the article in the Edinburgh Review just published on Life Assurance, refers to the present subject:—
“Amongst the more curious cases occasionally brought before actuaries are those professionally called issue eases. The individual entitled to a life interest in a certain property, if another now in possession of it should die without leaving issue, may resort to a Life Office to raise money upon his contingent life interest—to effect which he must assure against th e life tenants leaving issue. Sometimes such contingency is naturally very remote, but the transaction being peculiar, premiums of 20s., 30s., or even 40s. per cent. per annum have been demanded for such assurance, probably because actuaries have been unable to obtain a close approximation to the actual risk.”