REBATING AND OTHER SCHEMES 207

life insurance agents were known. It was quite as willingly given to the applicant himself when he was wise enough to call for it.

Later, when agents came into the arena, the rebate became a convenient weapon by means of which to enlist the influential men in the community—nearly always looking for the main chance and an advantage over their neighbours. It was moderate in amount because the agent's commissions were moderate.

When the pressure for higher and higher brokerages caused the American companies to exceed the provision for expenses in the first year's premiums in its payment of brokerages, the largest American company undertook to head off this stroke of enterprise by openly offering a rebate to every applicant. It raised a storm and was the subject of legislative investigation and interference. The following are some of the company's explanations and at-tempts at justification:

"When the number of lapses and surrenders grew to such proportions as to make it evident that the loss of contributing members must some day be repaired by the introduction of new lives at more than average cost, a fund was created from the retiring members, to which the existing policyholders have not contributed, and which is now made available, and will be used for the purpose intended. The money contrib-

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