THE EVOLUTION OF POLICIES 197

3d. A like income beginning at the end of the period and for the life of the insured and the beneficiary and until the last survivor succumbs.

4th. Should the insured and beneficiary both die in less than twenty years after maturity a like income to a designated beneficiary or the insured's estate for the remaining years to make up twenty full years' payments.

Yet another application of the plan of paying the proceeds in instalments is the so-called guaranteed interest bond, the condition of which is that after the maturity of the bond by the death of the insured or the completion of the endowment period, the company will pay interest annually at a certain rate upon the principal sum either for a fixed term of years (or for the after-lifetime of the beneficiary or of the insured) and at the expiration of the period (or the life) will pay the principal sum.

When the rate of interest is that which the company actually uses in computing its premiums and reserves, this policy is likely to be just what it purports to be and the premium for $1,000 of such insurance to be just what the premium for the same amount of insurance, payable in a lump sum, would be.

But when the rate of interest guaranteed is higher than the rate used in the computations, it means that the additional interest, so-called, is