The Insurance Guide and Handbook; Being a Guide to the Principles and Practice of Life Assurance; And a Hand Book of the Best Authorities on the Science - Cornelius Walford

This historic book may have numerous typos and missing text. Purchasers can download a free scanned copy of the original book (without typos) from the publisher. Not indexed. Not illustrated. 1900 Excerpt: ...the whole is distributed among the participating policyholders. In Proprietary Offices the shareholders are entitled to a percentage of the divisible surplus, generally ten per cent., though in a few Offices this share amounts to twenty per cent. Apart from this, however, it is not unusual for Offices to set aside a portion of the ascertained surplus for the purpose either of equalizing future bonuses or of providing for a more stringent method of valuation on a subsequent occasion. The balance then becomes divisible among those of the Assured who have effected "With Profit" Policies. Here, however, we have again a divergency in practice among Life Offices, some Offices allotting a bonus to every "With Profit" Policy in force at the end of the Valuation Period, and, at the same time, postponing the period when such bonus vests until the expiration of five years, while others make the distribution applicable only to such Policies as have been in force a certain number of years. By the former method, should the Policy either lapse or become a claim before the bonus vests, it ceases to be entitled to the share allotted to it, which accordingly falls into the surplus divisible on the following occasion. By the latter method all the Policies to which a bonus has been allotted receive the full benefit immediately. The intervals between succeeding Distributions of Surplus vary with different Offices, or, perhaps it would be more correct to say, groups of Offices. One Office, the old Equitable--whose history we have dealt with at some length in these pages--till comparatively recently distributed its surplus at intervals of ten years. These intervals have now been reduced to five years. Septennial intervals are much favoured by Scotch Offices, a...