Life Assurance Business Research Articles

Suggestions for a better means of making Provision for the Wives and Families of Persons engaged in the business of Life Assurance

Suggestions for a better means of making Provision for the Wives and Families of Persons engaged in the business of Life Assurance

On the Sufficiency of the existing Companies for the Business of Life Assurance; with a List of the Companies at the end of 1852, their Guaranteed and Paid-up Share Capital, &c

The question is frequently asked, in what respect competition in life assurance business differs from that in any other trade or profession. It is contended, that in trade the effect of competition is to produce a better article at a lower price—to awaken new tastes and desires in the public, and so to create a market, which, notwithstanding the diminution in the price, may afford larger profits to the merchant, by the greater quantity of the commodity which he can sell or the greater frequency with which his capital may be turned. But there is nothing analogous to this in life assurance, for in truth it is nothing more than a redistribution of the capital of the public—a deduction of the portion which one man may save out of his profits in the course of a long life, for the benefit of the family of another who does not live to save it.

The life assurance controversy

It was hardly to be expected but that an attempt to demonstrate the inconveniences arising from daily increasing competition in the business of life assurance should meet with resistance and reprobation. The large number of persons interested in novel undertakings of the character in question would naturally feel themselves aggrieved at statements which went to prove that such undertakings were mischievous because they could not be successful, and which sought to demonstrate their hopelessness of success by an expose of their actual condition; on the other hand, it is not much to be wondered at, that minds familiar only with a state of affairs so wholly different should regard with anxiety and alarm a succession of enterprises threatening not merely to encroach on their own field of operation, but, by a series of failures, to bring all alike into general suspicion and discredit. As in most other controversies, much allowance is to be made on either side. The interests of the two parties are probably not altogether antagonistic, but they can scarcely fail to come into serious collision unless placed under more carefully devised regulations than at present exist.