Till recently, it does not seem to have occurred to anyone that there was a fatal defect in the usual mode of estimating a life company's expenditure, and we were content to go on in the old way of considering it as the ratio such expenditure bore to the total premium revenue. And, so far as my recollection goes, not even the offices that had been animadverted on for extravagance, thought fit to dispute the dictum on the ground that this method of calculation was erroneous. However, since the reading of Mr. Deuchar's paper, and the more recent publication of Mr. Sprague's letters, these societies have awakened to the fact that they have been much calumniated; and are now ready, as a complete answer to the charge, to point out that it is their new business that has cost the money. No doubt this is a perversion of their theory that Messrs.

One of the most important duties of the manager of a life assurance company is certainly to watch the rate of mortality amongst the lives assured, by a systematic investigation at brief intervals, so that he may obtain from time to time an insight into the value of the business by which he is building up the greatness of his company.

The author commences by laying down the following propositions in reference to the management of life assurance companies:—

(a) That the first consideration should he the interests of the assured

(b) That, therefore, the true test of success should be the pecuniary advantage derived by the assured from the company.

(c) That, nevertheless, the first consideration in several companies has been the increase of the business, and that the interests of the assured have been injured in consequence.

(d) That the amount of a company's business is not a test of success.

The following paper was originally ritten simply as a reply to Mr. Macfadyen's, which was redd before the Institute in May last. It has since been carefully revised and to a great extent recast, in consequence of suggestions receivd, to the effect that the subject was of efficient importance to be delt with in an independent paper and submitted afresh to the consideration of the Institute. In consequence of this change, a considerable amount of personal criticism, which might hav been suitable enuf for a personal reply to another paper, has been either struck out altogether, or much modified. It will therefore be understood that, in what follows, I hav somtimes had Mr. Macfadyen's arguments in view when I hav not mentiond his name

From the fact that a very large amount of capital has been of recent years invested in loans to foreign governments, the question of sinking funds and other kindred matters has come prominently into notice; and matters which at one time were only looked upon as belonging to the theory of compound interest, are now become of great moment to thousands of persons who have invested, or purpose to invest, their money in the above-mentioned class of security. Various causes appear to have led to the large increase in the popularity of foreign loans among certain classes of investors. No doubt, the rapid growth of unemployed capital has considerably reduced the rate of interest realizable on first-class home securities, and has induced persons anxious to obtain a high rate of interest to invest their money elsewhere. From the nature of the case, however, even a fairly high rate of interest would not generally be sufficient inducement for an investor to lend money to a perfectly irresponsible foreign government, which might at any time, if it thought fit, renounce all its past financial obligations. Whether the general practice of providing for the repayment of loans has arisen from the scruples of foreign governments to accumulate a large national debt like our own, or whether, on the other hand, it has been found necessary to give an undertaking to repay the loan over a term of years, in order to make the loan at all palatable to investors, I cannot say; but the fact none the less remains, that very generally provision appears to be made, in the case of loans by foreign governments, for repayment in a shorter or longer period of time.

Several writers, notably Messrs. Higham and Sprague, have treated of the Mortality Experience of Life Offices, basing their investigations upon various data; and it may be thought that there is no necessity to pursue the subject further. The question is, however, one of great interest and importance, both in its relation to abstract science, and in its bearing on the actuarial management of companies; and as it possesses collateral branches which have hitherto received but little attention, it occurred to me that my time would not be wasted in attempting to elicit new facts, and illustrate old ones, from the abundant materials now at our disposal.

In connexion with a series of articles I have recently prepared for the Insurance Cyclopædia, bearing upon the history and practice of Fire Insurance, the subject of the Finance of Fire Insurance Offices has been very forcibly brought under my consideration. It is no part of the main design of that work, as I believe is very generally understood, to propound new theories in regard to the conduct of insurance companies. Its humbler purpose is to give a faithful record of the past history of insurance, to examine the foundations on which the different branches of the business are based, and to criticise, upon occasion, the data which has been relied on in their establishment; as also to supplement this data by reference to the new and ever increasing sources of information. In all this it has been my aim to present the views of others, rather than my own.

At one of the meetings of this Society last session a paper was read on this subject by Mr. Meikle, which gave rise to considerable discussion on the question; and as no definite result was arrived at, I believe a further investigation of the problem will not be without interest. Accordingly, I propose to go over the various formulas given for the value of this annuity, and offer some remarks upon each, stating wherein they are essentially different, and what appears to me to be the exact interpretation of each.

The question of the value of Female Life, actuarially speaking, as compared with that of Male Life, is one of considerable interest, as it is one which has, at least in more modern times, received considerable attention. Its investigation has, so to speak, been attended with many surprises, and more than one false alarm. It is a question which is constantly before the actuary, and in a considerable variety of forms. The want of correct knowledge on the subject led many of the early annuity societies and widows' funds into troubles from which they never recovered. Even yet there are certain “moot points” in practice, the solution of which the series of important facts intended—for the first time—to he presented in form here, is designed to facilitate.

There is a prevalent but erroneous idea entertained on this side of the Straits of Dover, that the business of the French life assurance companies is mainly composed of annuities and endowments, with but very little of life assurance properly so called. The truth lies much the other way. Indeed, the amount of business transacted in the assurance of human life, by the few French companies that exist—that is to say, for sums payable in the event of death—reaches a yearly aggregate of several millions of pounds sterling. The most successful French company, which at the same time is the oldest, issued, in the year 1874, whole life assurance policies for very nearly £2,000,000 sterling in that class of assurance alone, and in France alone—an amount that exceeds anything yet achieved by any English company whatever, taking, altogether, its business from Great Britain, the Colonies, and India.

The subject of Negative Policy Values has recently been touched upon, more than once, in actuarial discussions, and its bearing upon the general question of insolvency is now beginning to be realized.

That the reserve made by many companies is reduced, by the appearance of some of their policy values as assets instead of as liabilities, is a fact well known, and difference of opinion no doubt exists as to the propriety of such a state of affairs. Although I believe it may be assumed, that the general opinion of competent judges is, that so long as a company is popular, and its valuations otherwise strong, the existence of a moderate amount of negative values among its assets is of small importance,—it is important to bear in mind that these negative values can only be realized under favorable circumstances, and at the first symptoms of unpopularity in a company they begin to disappear. Whenever, therefore, the popularity of an office is on the wane, the extent of negative policy values taken credit for by it, in its reserve, becomes a matter of vital importance. Or, in other words, to those companies which do not require assistance from such a source, credit may be given for negative values; but to those companies which do require such assistance in showing sufficient funds, it is at least doubtful whether such credit should be given; and this, because the realization of negative values depends so entirely on the credit of the office.

M. Philip de Bosredon, Manager of the French General Life Insurance Company, having kindly furnished us with the printed reports of that company for a series of years, and Mr. George W. Kilford having sent us a similar series of reports of the French National, it appeared to us that a notice of these reports would be of great interest to the readers of the Journal in connection with the preceding paper. We have therefore drawn up the following account of the companies, with the assistance of Mr. J. J. W. Deuchar, of the Standard Life Assurance Company, to whom is due the whole credit of preparing the various statistical tables.—ED. J. I. A.

Several interesting observations have recently been made regarding the existence of maximum hours of mortality and the allied subject of recurrent variations in the activity of physiological function. During the present year an important contribution to the literature of the subject has been made by Dr. James Finlayson, of Glasgow, who in a couple of papers published, the one in the Transactions of the Philosophical Society of Glasgow for 1873-4, and the other in the Glasgow Medical Journal for April 1874, has supplemented and summarized Schneider's searching examination into the statistics bearing on the subject, tabulated the results of Mr. West Watson, a Glasgow predecessor in the study of vital problems, and collected the scattered statistics contained in the important contributions to the literature of this interesting enquiry. In an independent summary, showing the hours at which the greatest number of deaths occur in several Glasgow institutions, Dr. Finlayson determines the comparative cumulative mortality during successive hours of the same day, and during groups of hours collocated on account of some marked contrasts in meteorological conditions and physiological activity. As far as regards deaths from chronic diseases, the results obtained by Dr. Finlayson are confirmatory of those of Caspar and the summarized statistics of Schneider. They show a notably increased mortality during ante-meridian hours, as compared with those of the afternoon and evening, and especially a determinate maximum between 4 A.M. and noon. With regard to acute diseases, the figures of Dr. Finlayson show that in them the morning rise is nearly if not altogether equalled by a second rise in the extent of hourly mortality occurring in the afternoon. He accounts for this divergence from the general results, by referring to the influences exerted by the post-meridian rise in temperature which characterizes that group of diseases, as a means of determining in them the modification of their hours of maximum mortality.

The climate of any place is the result of the various phenomena regulating the natural order of the universe, as these are modified by circumstances affecting the particular locality. Climate has been concisely defined by Humboldt to signify all those states and changes of the atmosphere which sensibly affect our organs,—temperature, humidity, weight, agitation, electric tension, purity, and transparency. If we would correctly consider the climate of any place, it is accordingly necessary to give some consideration to every one of these phenomena. Temperature alone, if that be held to signify the mean annual temperature, gives a very imperfect idea of climate. It no doubt forms a most important element, but it must be considered with reference to its range, and that not only the minimum and maximum temperatures of the year, or the average daily temperature of the various months of the year, but it is also essentially necessary to know the daily range of the thermometer throughout the year, and during a series of years. The suddenness of the variations of the temperature is a most important element in judging of climate, and it is also important to understand the causes of the daily extremes of heat and cold, and the accompanying force and direction of wind during these extremes. Very intense heat and very severe cold may be borne without uneasiness, or even without much discomfort, provided these are unaccompanied by wind.

The recently published Experience of the Mutual Benefit Life Ins. Co., as given in Table (6) and columns (2) and (3) of the accompanying Percentage Table, is, in several important particulars, the most valuable contribution yet made to our American vital statistics. It is the most extensive that has thus far been furnished by any single company. The total number of deaths that had taken place in the Mutual Life when Mr. Homans constructed the American Experience Table, amounted to only about 2,900, while the Mutual Benefit records over 3,900, or about one-third more than the number on which that table was constructed.

The effect of selection on the mortality experienced by a life office, and the addition which should be made to its reserve when a large proportion of its policies are of recent date, are questions which have often occupied the attention of actuaries; but owing to the paucity of data, no means, so far as I am aware, have hitherto existed for calculating, with any attempt at precision, the allowance which should be made for what is commonly called suspended mortality.

The want of a national register of still births is one of the causes which in this country interfere with such important inquiries as those that relate to the true mortality due to parturition. No doubt our system of registration of live births is sufficiently perfect; but until a corresponding record of still births is available, it will be impossible to ascertain, with the accuracy necessary for statistical purposes, the number of women who have, within a given period, become mothers. This is the more to be regretted, since the danger to the life of a female is likely to be far greater when she has given birth to a dead child, than when by her labour she has added a unit to the living population of the country.