r's disposal should
look to the party benefited for his remuneration. Any compensation
given for such service to a go-between by a mutual company is paid by
all, and the question arises, Is the advantage to the company of
sufficient importance to warrant the imposition of this tax upon all
its members promiscuously? The following, from the Massachusetts
Insurance Commissioner's Report for 1885, leaves no doubt as to the
convictions of the writer on this important matter:

"The expensiveness of the life insurance policy is not because the
level net premium is too high, for the premium is absolutely just,
and the policy holder gets full value; but the complaint justly
applies to the excessive expense charge. A person who wants
insurance, life or fire or other, should be able to buy it at
first cost without paying tribute of profits to middlemen. To that
complexion the matter will finally be brought by the force of
intelligent opinion, whatever resistance may be opposed by persons
whose thrift lies in the perpetuation of the expensive system now
in fashion."

It requires but a slight degree of prophetic vision to predict that in
a very few years the companies in self defense will be obliged to
change their method of compensating agents.

Several companies have already begun the reform by grading
commissions; granting a percentage proportional to the amount of
insurance likely to be done on the policy. Other companies have simply
reduced the amount of the commission rate, thus virtually withdrawing
from active competition.

This will, in a certain degree, explain the wide variation in the
figures given above, where it is noticed that, in five companies out
of twenty-two, the total agency expenditures amount to less than the
general expenses, while in six cases the companies spend more than
double as much on the former as on the latter. In either class we find
representatives of the five largest companies in the country.

On applying the foregoing ratios to the business of the existing
companies we find that, calling the theoretical expenses $100, the
actual expenditures for 1889 were as follows: $112.67, $118.34,
$150.40, $194.48, $208.16, $208.53, $228.66, $235.89, $248.44,
$250.79, $258.33, $258.57, $265.14, $267.19, $267.92, $274.47,
$294.17, $314.96, $335.70, $377.94, $616.70.

In this discouraging exhibit there is one ray of comfort. The combined
assets of the two companies heading the list