  SCOTCH LIFE ASSURANCE.—SCOTTISH WIDOWS’ FUND—ITS DIRECTORS.—NORTH BRITISH.—THE FARMER’S FATE.—EDINBURGH LIFE.—LIST OF SCOTTISH COMPANIES. For more than one century the life assurance companies of England were sufficient for the requirements of Scotland; and, whatever opinion may now be formed of institutions founded on the proprietary principle, yet life assurance would have been still in its infancy without it. And the reason is obvious. It was the great object of these societies to pay the best dividend they could. To do this it was necessary to spread their advantages far and wide, to appoint agents in the remotest parts of the country, to familiarise the public mind with its principles, and to advertise its benefits wherever a village or district was ignorant of them. By 1812, however, a proposal was printed “for establishing in Scotland a general fund for securing provision to widows, sisters, &c., and for insuring capital sums on lives, to be called the ‘Scottish Widows’ Fund and Equitable Its prospectus rivals the mining advertisements of the present day. The society was to be supported by 2 Dukes, 1 Marquis, 6 Earls, 2 Viscounts, 2 Lords, 2 Honourable Gentlemen, and 3 Baronets, as patrons only. It boasted a Viscount as President. There were 4 Vice-presidents, 27 Honorary Directors, 15 Ordinary Directors, and 20 Extraordinary Directors. Its tables were founded on the Northampton observations of Dr. Price, and the presumption of improving money was at 4 per cent. per annum. But though it was ushered in with so brilliant an array of names, it would seem as though they of Scotland were not to be thus tempted. It requires hard work to place a new company on a proper footing, and as dukes, marquises, or peers are not usually hard workers, it took three years before this company could commence its operations; and while the little insignificant-looking prospectus which announced its advent is dated 1812, the society itself, ultimately attended with such brilliant results, was not able to commence its operations till 1815. Its first constitutional meeting was marked by a feature perfectly in keeping with the devotional character of The difficulties incidental to mutual assurance beset the new society. For a time its sole capital was 34l. 12s. 6d. The most imminent danger must have been apprehended by its friends; and until a sufficient fund was accumulated, an accidental death might have precipitated its ruin. Its early records prove that great anxiety existed, that various precautions were proposed, and that a natural alarm overshadowed its progress. This fact is an exposition of the chances which assurance companies on the mutual principle must run, and of the dangers to which they are liable during any abnormal or remarkable period, when with no capital subscribed to back them, a plague in the shape of the cholera, or an epidemic like the small-pox, may prove that figures are not facts, and upset the most elaborate calculations or the most undeniable tables. The difficulties of the first year were surmounted, and insurers came to its support. Year after year it
A comparison was made between the English Equitable and the Scottish Widows’ Fund during the first eleven years of each. In the English Equitable the assurances were only 230,000l.; in the Scottish they amounted to 493,000l. The annual income of the former was but 9500l., of the latter 17,500l. The English Society, at the end of eleven years, possessed an accumulated capital of only 29,000l., while the Scottish boasted one of 72,000l. Such was the success of an institution which could not even commence business for three years after its advent, which began with a capital of 34l. 12s. 6d., and which, by the evidence of its own manager, was doubtful of its continuance for the first year or two of its existence. That the Scottish Widows’ Fund has been serviceable to thousands, and that it has stimulated other companies, is undeniable; but it is equally undeniable that it is a mere trading institution founded on mercantile The first proprietary was in 1823, when the North British Fire Company added life assurance to its ordinary business. A company with a capital is often of much service to the cause of life assurance in any place where it is newly introduced. Where a mutual society fears to expend its money, a proprietary company will send its proposals to every journal in the place; and by spreading its doctrines among a remote but intelligent agricultural population—by giving an absolute safety to the insured, by virtue of its capital,—it is often productive of inestimable When they returned to the farm-house, the agent, who saw that if his host died, all that he had done would be for his landlord’s benefit, only said to him, “You must have spent a large sum on this estate.” “Many thousands,” was his curt reply. “And if you die,” was the shrewd retort, “your landlord will receive the benefit, and your wife and daughter be left penniless. Why not insure your life?” The man rose, strode across the room, and drawing himself up as if to exhibit his huge strength, said, almost in the words of one of Sir Bulwer Lytton’s The agent was not daunted—he persevered, explained his meaning, enlisted the kindly feelings of his host, persisted in asking him how much he would leave his family, and at last induced him to listen. They examined his accounts, and found that he could spare about 120l. a year. The village apothecary was almost immediately sent for, the life was accepted, and policies were granted for 3000l. In less than nine months this man, so full of vigorous health, took cold, neglected the symptoms, and died, leaving only the amount for which he had assured his life to keep his family from want. There is much in favour of life assurance in this little anecdote, and there is much too in favour of the proprietary system, for a man like this would not have risked his savings with a mutual insurance society. The Edinburgh Life Assurance followed in 1823, having been originated by the legal bodies in Edinburgh at the same time, and very much upon the same principles, with the Law Life in London. The Scottish Union ensued in 1824, the Aberdeen in 1825, and the Scottish Amicable in 1826. It is one advantage of all new life companies that they assist in forwarding a principle; and there is another feature in them. In most other speculative societies, their failure produces very painful results. A railway sees its capital spent, and is obliged to make farther calls upon its proprietors. An unsuccessful canal company has only the certainty of having fed and demoralised some thousands of stalwart navigators in exchange for the ruin of its shareholders, while the failure of a mine is the melancholy close of many a bright hope. But it is not so bad with a life assurance company. The insured—except in offices originated with a fraudulent design, such as the West Middlesex—has never yet been deceived by the failure of a policy. To take Scotland as an instance, many of the companies have not been able to maintain their ground; but in no one case has the policy-holder risked his premium or lost his assurance. Thus the Scottish Life, when unable to maintain itself, handed its business to the Mercantile, which then became responsible. When the Mercantile ceased to be an independent company, it transferred its policies to the “Life Association.” The “Scottish Masonic” and the “Bon Accord” business was taken up by the Northern. In no instance, therefore, has any legitimate company failed
Offices that have transferred their Business.
Thus, in Scotland one office was established in 1815; five from 1816 to 1825; three from 1826 to 1838; six from 1836 to 1845. The united incomes of these are not far short of 1,400,000l.; and the assurances now in force amount to about 33,000,000l. THE END. London: [1] When asked what benefit it would produce, he replied, “C’est pour perfectionner l’art des arts, l’art de penser!” This, at first regarded as a mot, became a proverb. [2] The title of this essay is “Waardye van Lyf-Renten naer proportie van Losrenten;” or, the “Value of Life Annuities in Proportion to Redeemable Annuities.” [3] There was no just cause for surprise in these periodical visitations. The thinkers of the day understood the connection between cleanliness and health; and the following will show that such as these hit on the right source of pestilence:— “I often wonder,” says Erasmus in a letter to Dr. Francis, “and not without concern, whence it comes to pass, that England for so many years hath been continually afflicted with pestilence, and above all, with the sweating sickness, which seems in a manner peculiar to that country.... They glaze a great part of the sides with small panes, designed to admit the light and exclude the wind; but these windows are full of chinks, through which enters a percolated air, which stagnating in the room, is more noxious than the wind. “As to the floors, they are usually made of clay, covered with rushes that grew in fens, which are so slightly removed now and then, that the lower part remains sometimes for twenty years together, and in it a collection of spittle, vomit, urine of dogs and men, beer, scraps of fish, and other filthiness not to be named. Hence, upon change of weather, a vapour is exhaled very pernicious, in my opinion, to the human body.” [4] The first parish registers were kept in England in 1538, in consequence of an injunction from Thomas Cromwell. They had been kept for a long time previous in Augsburg and Breslau, though it was not till the beginning of the 17th century that they were general in Europe. It is worth mentioning, that long ere this, the paternal government of Peru kept a register of all the births and deaths throughout the country; exact returns of the population being made every year by officers appointed by the state. [5] About as much silver as is now coined into 3l. 1s. 11d. [6] Equal in weight to about 2l. 1s. 3d. of our silver coinage. [7] Equal in weight to 10s. 4d. of our present silver coinage. [8] The following figures will give some idea of the chances of life as estimated by Dr. Halley:—
[9] The total amount paid by each company was 150,000l. [10] By Kersseboom’s table, out of 817 persons of 20 years of age, all living at the same time—
By De Parcieux’s, it appears that out of 814 persons of 20—
[11] In 1768, Mr. Mores quarrelled with and separated from the society. [12] Sir Richard was a notability of those days, and divided civic popularity with Beckford, whose colleague he was in the representation of London in 1761. He was made Doctor of Civil Laws by Oxford University, a custom which would have been perhaps more honoured in the breach than the observance; and we owe Blackfriars’ Bridge greatly to the energy and exertions of Sir Richard Glyn, Knight, Baronet, and Lord Mayor, and—more honourable title still,—director of our first purely mutual life assurance office. We look in vain for such names as Glyn, Gosling, Ladbroke, or Beckford, among the sheriffs and aldermen of the present day. [13] That the safety of this Society was doubtful may be partly judged from the fact, that half the policies issued within the first twenty-five years had been abandoned, probably from doubt of their ultimate payment. [14] 14 Geo. 3. c. 48. [15] “Never grant life annuities to old women,” Gideon would say; “they wither, but they never die;” and if the proposed annuitant coughed on approaching the room door, Gideon would call out, “Ay, ay, you may cough, but it shan’t save you six months’ purchase.”—“Chronicles and Characters of the Stock Exchange. By John Francis.” 2nd. Edition. [16] The present Marquis of Lansdowne. Birmingham. [18] The following table will show the precise action of an investment of 100l. on a nominee aged 90:—
Thus the capital and interest at 8 1/2 per cent. were returned in one year, three months, and two days. [19] One gentleman thinking that the Greenwich pensioners would afford good subjects, went to the hospital with that purpose. But they all gave their ages at 90 and above, and when the parish registers were searched for the dates of their birth, it was discovered that they had exaggerated, in some cases ten and in others twenty years. Every one claimed the distinction of being nonogenarian, and the consequence was that the stock-broker was completely baffled in his attempt. [20] It is difficult to avoid blaming the offices. These large and varied insurances were, probably, known to every company in existence. The reasons assigned should have been tested, and very little trouble would have shut the door of every office in London on Wainwright and his companions. For so much money to be risked on the life of a girl of twenty-one, described as “remarkably healthy, whose life was one of a thousand,” and that too for only two years, merely because a nominal plea of insurable interest was given, was neglectful and almost culpable; although there is some extenuation in the fact that this lady assisted to deceive by uttering, or at least coinciding in a false statement to Mr. Ingall, at the Imperial, is certain. The slightest inquiry would have discovered that Wainwright was a beggar, that this young lady had no direct or indirect interest in any property whatever, and that the premiums must have been paid with some sinister purpose by a man steeped in difficulties and overwhelmed with debt, on the life of a healthy but most unhappy girl, entirely under his control. [21] “Lucretia.”—By Sir E. B. Lytton. [22] This man appears to have been an innocent tool in the hands of his acute brother-in-law. [23] This was first pointed out by the Quarterly Review. [24] The following form extracts from the above articles of Mr. Mackenzie:—“Some time ago there was sent to this office a series of advertisements in favour of the Independent and West Middlesex Insurance Company, which were entered and paid for in the regular course of business. We are cautious about quack medical advertisements, none of them that we are aware has ever been admitted into our columns; but it never entered into our heads for one moment, that an insurance company professing to be incorporated by special acts of parliament, was in truth a quack company, got up for the premeditated purpose of imposing on the public in matters of fire and life. Hence the advertisements of this company glided through our columns from time to time to time.... But we were astonished lately to learn that this was a spurious insurance company hatched in London two years ago.” “Under these circumstances, our duty, we humbly conceive, is at once plain and decisive, and therefore we proceed to discharge it for the sake of the public, whose faithful and unflinching servants we at all times profess to be. In a word, we raise our voice and warn the public against this Independent West Middlesex Insurance Company. It is a false and fictitious company.” “In their polices of insurance they take care to provide that ‘the capital stock and funds of the said company shall alone be answerable to the demands thereupon under this policy.’ Why, what is the value of their capital stock and funds, if as we say the parties themselves forming the said company are utterly worthless, being in fact no better than a parcel of tricksters in London, disowned, or repudiated, or condemned by every respectable person to whom reference is made? There can scarcely, we think, be anything so base or so nefarious as taking premiums from unsuspecting people, and making them believe they are secured against the contingencies of life, or the risk of fire, and yet mocking them in their calamities when the bubble bursts.” [25] The cholera first visited England about the beginning of August 1348. From the seaport towns on the coasts of Dorsetshire, Devonshire, and Somersetshire, it ran to Bristol, and the men of Gloucester established a quarantine between the two places. But this “familiar fury” mocked then as now at the quarantine, and walking in darkness appeared in Gloucestershire to the horror of its inhabitants. From thence it passed by way of Oxford to London, finally spreading all over England, “scattering everywhere such ruin and desolation that of all sorts hardly the tenth person was left alive.” In the church and churchyard of Yarmouth, 7052 were buried in one year. Within six months, in the city of Norwich more than 57,000 died. In London, death was so outrageously cruel that every day saw twenty, sometimes forty, and sometimes sixty or more dead bodies flung into one pit. The churchyards became crowded. Fields and additional places of burial were set apart, and these soon failed to suffice; the number of the dead increasing so rapidly that “they were fain to make deep ditches and pits very broad, wherein they laid a range of carcasses and a range of earth upon them, and then another range of dead bodies,” and in this manner the people, except those of the better sort, were placed in their long home. The cattle died in hedges and ditches by thousands for want of men to attend them. All suits and pleadings in the King’s Bench and other places ceased. The sessions of parliament were stopped. England and France forgot for a time that they were “natural enemies.” County, city, and town witnessed solemn prayers and public processions for days together, and God was implored in highway and in byway to “sheath his angry sword and preserve the residue from the devouring pestilence.” When this pestilence which yet yearly threatens our coast had passed away, it was found that its prey had been chiefly old men, women, and children of the “common sort of people,” and that but few of the nobility of the land had been seized by it. Property was for a long period depreciated: that which was previously sold for forty shillings, only fetched a mark; and the Scots in scorn invented a new oath, swearing in contempt “by the foul deaths of the English.” [26] Letter to the Right Hon. Joseph W. Henley, M.P.—By Robert Christie. [27] The Equitable even was regarded with a very suspicious eye by the Court of Chancery soon after its commencement, and the names of bankers and merchants as directors, great in their day and generation, did not prevent the proprietors of the Royal Exchange, the Amicable, and the London Assurance corporations from predicting its failure. [28] The public is greatly indebted to Mr. Hartnoll, the avowed editor, and Mr. Pateman, the publisher of the Post Magazine, for their great exertions in the cause of Life Assurance. [29] “Assurance Companies’ Accounts,” p. 43. [30] “That the said Commissioners shall have full power to examine all books, at all seasonable times, of such bankers as issue notes, and to take copies or extracts from any such books or accounts.”—History of the Bank of England, its Times and Traditions.—By John Francis: 2 vols. 3rd edition. Longman, Brown, and Co. [31] The Morning Chronicle. [32] “I tell the tale as ’twas told to me.” It has, however, been suggested that he failed to take the dose in his extreme agitation. [33] Night and Morning. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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