210 BUSINESS OF LIFE INSURANCE

ing character: The company offers a very large bonus for a certain amount of new business. If the bonus is earned the profit to the agent on all the business effected is so much increased that he can afford, if necessary, to pay very large commissions for much of the business—and quite as well and with more effect, to give the same commissions to the insured as a rebate. This results in a great deal of life insurance being sold at certain times for premiums which are merely nominal.

There is compensation in all things. So far as the companies are concerned which enable these rebates to be offered, the purchaser of life insurance will discover, if he looks up the relative rates of premium in them and in others which pay too small a commission to admit of it, and the dividends paid and surrender values promised by both classes, that he would be robbed if he failed to get the rebate and that, if he does get it, he will give more than a quid pro quo in many ways.

In order to avoid curing this evil by the only effectual method, the abandonment of high brokerage commissions and bonuses, companies and agents have induced Legislatures to pass laws prohibiting rebating, which they call "discriminating between persons of the same age, class and expectancy of life." These laws have in the main been dead letter statutes. Only rival