14

VITAL STATISTICS.

Where, as in fire insurance, insurances are made for a year only or at most for three or five rears, it is sufficient to know approximately what the average hazard is for the class of risk embraced in the insurance. As a matter of fact, fire insurance companies have clone with less than this; that is, with merely knowing that, on the whole, the business pars a margin, without knowing that this or that class of hazard has been profitable. If a fire insurance company were, by the nature of the business, compelled to take risks, without the privilege of refusing to renew at the same rates of premium, much greater care would of course be taken in determining rates; but even then the hazard dealt with would not be an inherently increasing one. The problems of classification would perhaps be serious and difficuh; but, when they were once determined, the annual risk would not change, the conditions being undisturbed.

Life insurance is usually sold, either for a long term or for the whole period of life, and either for a level premium or for a fixed premium in any event. Even in assessment insurance, where the premiums may vary, the power is not given to vary them as to a particular life, because that life is likely to fail. The insurance can-not be cancelled by the company, and it is nearly always renewable by the insured at pleasure.

If life insurance were for a year at a time, the company- being free to refuse to renew, the problem ~would be merely to ascertain in what ratio do men, beginning