IS BUSINESS OF LIFE INSURANCE

to cover the full, annually increasing premium for $1,000 insurance. In this case, however, you must on the other hand rebate to the policy so much of this annually increasing premium as would pay for an insurance that year equal to the fund on hand, and when the insured dies the fund itself is rebated back in the same manner to those who survive.

Second : That the "actual insurance," as it is called, i. e., the amount payable above what the insured's own fund will cover, is all that the company has at risk, and therefore all that need be charged for at the annually increasing rate of premium.

The mortality being the same, that is, according to the table, the two things bring the insured out with the same net fund on hand.

To compute the annual premium it is first necessary to find out what on the average one dollar, payable at the beginning of each year, so long as the insured lives, will be worth. Re-course is therefore had again to the mortality table, as follows:

The value of the first $1.00 is 100 cents, be-cause it is paid in advance.

if the dollar at the end of the first year were paid without reference to the survival of the insured, it would be worth $.97087. But it is only payable by the 99,251 men out of 100,000 who survive the year, and the chance that this youth,