It would be beyond our province to deal with the comparative merits of these systems; undoubtedly, offices iu which the assured participate in a part or the whole of the profits, have for some years back enjoyed the largest share of public support. Life assurance, in the abstract, is certainly one of the greatest blessings of modern times. The extent to which it has been made available may be judged from the fact that the total sum, including vested bonuses, for which the existing offices are liable is above £343,000,000 sterling; the annual premiums payable, therefore, being above 10,000,000 --a sum equal to one-seventh of the net public revenue of the United Kingdom, or nearly half of the entire customs duties.
A greatly increased facility for making the necessary calculations in connection with life-assnrance,has been developed within the last few years by the use of "commutation tables," the invention of Mr. George Parrett, and of which a large collection, calculated by Mr. D. Jones, is published by the society for the diffusion of useful knowledge. For the best information on their construction, and other formulm, the reader is referred to the standard works of De Morgan, Gray. Milne, and the transactions of the institute of actuaries, published quarterly. See POST-OFFICE INSURANCE.
3. Marine Insurance.—Although this branch of the subject does not possess such a general interest as the preceding, it is one that requires quite as great an amount of study and experience to insure its successful prosecution. In estimating the rate of premium, the insurer has to take into account not only the quality of the vessel covered, but the season in which she sails, the known character of her captain, the nature of the commodity carried, and (the contract being an indemnification both against the elements and the enemy) the state of our political relations. Nevertheless, losses at sea, like other incidents, are observed to follow certain laws, and if the average from which the value of the risk is deduced is of sufficiently broad basis, the result over equal intervals of time can be predicted with reasonable certainty. Until 1824 the only companies that could grant marine insurances were the Royal Exchange and London Assurance; and although the monopoly of these offices then ceased, and many other companies have since been established, a large portion of the business is, however, still transacted by individual insurers designated "underwriters." The underwriters of London form an influential society known as "Lloyd's" (q.v.), from having originally met in a coffee house kept by a person of that name in Abehurelf lane; and their extensive business, numerous agents for procuring information, and general influence in the mercantile community, have long gained for them a world-wide reputation. As a small number of
risks, viewed in connection with the great hazard to which property at sea is exposed, would not secure a safe average to the individual insurer, he finds it prudent to take but a fractional part of the entire risk on himself, and this is done by subscribing or "underwriting" the stipulated proportion on a policy drawn out for the whole amount to be covered. The necessity for circulating the policy for this purpose, and otherwise negotiating the insurance, has given rise to another business, that of the "insurance broker," with which, however, that of the underwriter is often combined. A system or mutual insurance is frequently carried out by associations of ship-owners forming " clubs," by which ship-owners arrange for the mutual insurance of their vessels, or shares of vessels—the various claims arising from loss or accident being met by pro rata contributions from the members in proportion to the sums respectively insured by them. Under this system the commission of the ship-broker, although included in the premiums, is saved by the owner.
Marine insurance differs from an ordinary fire insurance, in respect that in case of partial loss the underwriter pays only such a proportion of the sum insured as the damage sustained bears to its whole value at the time of insurance. See AVERAGE. In adjusting a partial loss, it is usual to deduct one-third of the nominal value, for new materials furnished to replace the older destroyed, and labor. Policies are of two kinds. " valued "—where the insurance is based on a specific bill of lading—and "open," whae. in case of loss,. the value of a ship with her stores'is estimated as at the date of sailing, her freight at the amount she would have earned had the voyage terminated favorably, and her cargo at its invoice price, adding premium and all charges. The insurance is binding although the ship may have been lost when the policy was exe cuted, but any warranty, if not true, is held to vitiate the insurance, even although the misstatement is not material to the risk. A stamp-duty, now reduced to a nominal rate, is levied upon all marine insurance policies. In fixing its amount, the choice lies with the insured of doing so with reference to the term of insurance (not exceeding one year), or per single voyage, as follows: By time—for any term not exceeding six months, 3d. per £100; exceeding six months, 6d. per £100. By voyage, 3i1. per £100. The rates for marine insurance have been much increased within recent years, in conse quence of the increased number of shipwrecks. For the five years 1861 to 1865 inclus ive, the annual average reported was 1538; from 1866 to 1870, 1862; and from 1871 to 1876, 2,530. The increase is partly explained by the inclusion of minor casualties in the latter period.