amount to over
$100,000,000. There is no question as to their financial standing, and
both show a large increase in membership over the previous year. I may
also say here that it is a difficult matter to get at the actual "cost
of insurance" in the various companies. Many of them, on their own
acknowledgment, do not compute the advance cost of carrying their
"amount at risk," and others, for reasons of their own, do not care to
state the figures. In cases where the correct figures were not
obtainable, I have assumed the cost to have been 1-1/3 per cent. of
the mean amount at risk.

If we should, in our comparison, omit the actual agency expenses and
commissions, the ratios would stand as follows:

Where I would allow $100 the companies actually used: $43.17, $55.90,
$65.21, $77.21, $82.39, $88.34, $91.99. $91.98. $92.19, $94.65,
$97.15. $99.55. $99.11. $102.86, $109.35, $125.05, $133.03, $141.92,
$195.90, $207.06, $287.72.

As might be supposed, the first two ratios are those companies before
alluded to. These companies might have doubled their advertising
account and expended $300,000 between them on agents' salaries, and
still have kept within my allowance.

Admitting, for the present at least, the reasonableness of the
proposed allowance for the expenses of the banking and insurance
departments of the business, we have before us the problem how to
equitably adjust the burden among the great variety of policies.

In the first place, _there should be no policy in the company that
does not contribute its proportionate share of the expense allowance
during every year of its life_. I make a special point of this, for at
present the policies which have become paid up, either by the payment
of a single premium at the outset or by the completion of a stipulated
number of payments, contribute practically nothing to the expense
account after the premium payments cease.

The following plan, I think, complies with all the requirements of the
problem. By the proposed method every policy, at all stages of its
existence, contributes its exact share to the expense fund, whatever
its plan of payment may be.

Let us, as an illustration, examine the case of a ten year endowment
policy, taken out at age 30, and consider it under three aspects,
first, as paid for in advance by a single payment, second, as paid by
five annual payments, and third, as paid for annually throughout the
term. I have used this short term endowment poli