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than one-tenth of the total at the age of 33; at the age of 67, however, it constitutes almost one-half of the total, having become the largest single item a decade earlier.
It would be easily possible to extend such an analysis, and to examine how far the data for the different groups of employment correspond with or vary from the summary results, but the above will suffice to further enforce what has been discovered as to the importance of accurate data on which to base the computations as to relief, and particularly in the graduated forms in which, as noted above, it is customarily offered for the different periods of sickness.
The experience of the Ancient Order of Foresters, 1871 to 1875, gives a total of 109.42 weeks' sickness between the ages of 20 and 79, inclusive, for the first six months' sickness, rural members experiencing 102.49 weeks, members in towns 107.28 weeks, and se in cities 118.84 weeks. Falling within the second six months' sickness there was a total of 32.72 weeks, within the second year 34.09 weeks, while the remainder of sickness amounted to 98.39 weeks, or a total of 274.62 weeks in the 60 years covered. The proportions as to rural, town, and city population are nearly the same during the second six months sickness as during the first, the towns presenting approximately the average rate, while the rural and city membership are respectively below and in excess of this average. This rule does not hold, however, in the more protracted cases, since during the second year rural members experience 31.71 weeks of sickness, town members 36.74, and city members 32.41, the average 34.09, as stated above. The remainder of sickness is reported at 87.77 weeks for rural members, 116.35 weeks for town districts, and 92.82 weeks for cities.
The tendency of continued or reduced sick pay to assume the nature of a pension or annuity is evidenced by the tables already given, but is more clearly brought out by a table prepared by Mr. F. G. P. Neison on the basis of the experience of the Foresters, which shows the percentage of annual sickness for each year from age 18 to 79, falling within the various periods of sickness, or, to state it differently, distributed in accordance with the duration of the claims. The table follows:
PERCENTAGE OF SICKNESS FALLING WITHIN VARIOUS PERIODS, BY YEARS OF
LIFE. FORESTERS' EXPERIENCE, 1871 to 1875. [Source: Report upon the additional statistics deduced from the original records of the sickness experience
of the order, 1886.]
More than one-half of the sickness falls in the first six months period until the age 60 is reached, while at the age 65 sickness for the second six months is practically equal to that of the second twelve months, after which the latter is in excess. Shortly thereafter also (at age 68) the "remainder of illness" embraces a larger percentage of sickness than does the "first six months" period, and rises to approximately. 50 per cent of the total at age 79.
The foregoing tables treat chiefly of the matter of sickness experience, the question which is considered to be the one of prime importance in the conduct of the British friendly society, the question of provision in case of death taking second rank. As has been noted, sick relief is more frequently a matter of local provision, while death benefits are more likely, especially in the case of the affiliated orders, to be paid out of funds drawn from a wider area. The standards fixed by the same principal organizations are accepted in the matter of death benefits or insurance as in that of sickness experienced, and the following table will make possible a comparison of the data relating to the mortality experience of these leading organizations or groups of organizations in this form of industrial insurance.
For purposes of comparison the following table is submitted, showing the number of persons surviving at various ages out of 1,000 living at age 18. The table includes the results of the investigation of the Independent Order of Odd Fellows, Manchester Unity, covering the years 1893 to 1897.
NUMBER OF SURVIVORS AT VARIOUS AGES OUT OF 1,000 PERSONS LIVING AT AGE
18, ACCORDING TO DIFFERENT MORTALITY TABLES.
(Source: Actuary's Report, Irish National Foresters, 1908, and Manchester Unity Experience, 1893 to 1897.)
Attention has already been called to the increased longevity of the population of Great Britain as it has been observed by the Manchester Unity of Odd Fellows in its different investigations. This fact makes it important to notice the dates of the observations on which the items of the above comparison are based. The Foresters' table records the experience of the years 1871 to 1875, the Rechabites that of the years 1878 to 1887, and the table of the friendly societies that of 1876 to 1880. The dates of the two Odd Fellows' investigations are given in the headings, the increase in longevity between the two dates being clearly indicated. The sole exception is in the case of survivors at the age 90, the reason for which is not apparent. The Rechabites' and friendly societies' tables are practically contemporaneous, and showed a marked advantage in favor of the temperance order. This advantage holds good in a comparison of the Rechabites' tables with all the others, except for the ages 30 and 40 in the latest table of the Manchester Unity, and it seems not unlikely that the balance of these ages would be shifted by an investigation covering the same years.
As a basis for life insurance, or the payment of death benefits, the Foresters' table would afford the widest margin, as the expected deaths would not now be realized, if the other tables can be accepted as a criterion applicable to the membership of an organization. On the other hand, for a society of general membership to adopt the tables of the Rechabites would result disastrously. If, however, the Foresters' table is used in connection with provisions for sick benefits, the actual survivals to advanced ages (in excess of expectancy), with the accompanying increased duration of sickness periods, would tend to result disadvantageously to the sick funds.
OLD-AGE AND INVALIDITY INSURANCE THROUGH POST-OFFICE
The question of governmental provision for insurance against the hardships of an old age unprovided for by savings or other means of support has been the subject of discussion in Great Britain for almost a century and a half. Two distinct results have ensued, the one in the nature of an offer to write insurance through the post-office savings banks, providing for annuities or for payments on the death of the insured person; the other in the nature of a pension payable to indigent aged persons who comply with certain conditions, but involving no payment of premiums. The latter provision is not insurance, in any customary use of that term, but is the only activity of the state of considerable effect, the privileges of insurance through state agencies having been availed of only in a slight degree. It is apparent that invalidity is only incidentally provided for in such systems as these, and the importance of the friendly society and the trade union in furnishing opportunity for an insurance against dependence during sickness is the more clearly apparent from this fact.
In the order of their historical development the subject of annuities and insurance procurable through the post-office savings banks is entitled to first consideration. An effort was made as long ago as 1771 to establish life annuities in parishes, the amounts not to exceed £20 ($97.33) per annum, to commence at the age for males and of 35 years for females; deficiencies, if any, were to be made up from the parish rates. Bills containing these provisions were introduced in Parliament in 1773 and in 1789 but failed of passage. Mr. Pitt proposed the formation of parochial funds, to be raised in part by voluntary subscriptions and in part by local taxation, to be used to relieve cases of distress arising from old age or from chronic sickness, and for the support of the widows and children of deceased members of the funds. This was in the year 1796, but neither this nor a somewhat similar proposition offered in 1816 was adopted.
The first successful attempt at legislation of this class was the act of 1833 (3 and 4 William IV, chap. 14), which allowed the purchase from the national debt commissioners of annuities, either immediate
of 50 years
or deferred, through the agency of savings banks or of societies to be established for the purpose in places where there were no savings banks, post-office savings banks not being at this time in existence. This act fixed the maximum annuity at £20 ($97.33) and the minimum at £4 ($19.47). This was the-beginning of a system of annuities and insurance by direct governmental action which has been continuously carried on to the present time, but has never attained any large measure of economic importance. Prior to 1864 insurance could not be written in excess of £100 ($486.65), and only in behalf of applicants who also took out a deferred annuity or old-age pension. Little use was made of the privileges offered, and an amended law on the subject was enacted in 1864 (27 and 28 Vict., chap. 43); at which time serious and sweeping charges were made against friendly societies as an institution, the argument being that governmental agencies should be available for the use of the people generally, in order that they might not suffer from the alleged abuses and unreliability of the societies.
The title of the law was “An act to grant additional facilities for the purchase of small government annuities, and for assuring payments of money on death.” Post-office savings banks had been established some three years prior to the passage of this law, and it was provided that these institutions should be the medium through which the Government should administer the insurance contemplated. The treasury was directed to frame tables of rates, and the rate of interest on the reserve fund was fixed at 3 per cent. Provision was made for policy holders who defaulted after paying for five years, or who wished to cease making payments after a like term, giving them either a return of a portion of the premiums paid in (to be not less than one-third the amount so paid) or a paid-up policy or an immediate or deferred life annuity. The maximum annuity procurable under the act was £50 ($243.33), and the maximum and minimum amounts payable on account of death were fixed at £100 ($486.65) and £20 ($97.33), respectively. No contract of insurance could be made before the age of 16 or after the age of 60.
The scheme was purely voluntary and permissive and had none of the attractions of fellowship that the mutual organizations and societies offered. It was not only without interested and active promoters, but met with both competition and opposition at the hands of the friendly societies and the private insurance companies. It was of slight effect, therefore, as a measure of insurance. During the seventeen years of the operation of the act of 1864 only 6,524 life insurance contracts and 11,646 annuities were arranged for through this medium.