reserve
plan is often called "scientific insurance" because, upon the basis
of these assumptions resulting from experience, it makes exact
mathematical calculations of the premiums and reserves needed for
insurance of any particular kind in respect to age of insured,
number of payments, method of paying the beneficiary, and any other
conditions. The premium thus fixed is, however, only a maximum, and
usually is reduced as the result of conditions more favorable than
those assumed.

Sec. 11. #The mortality table.# When large numbers of men are taken as
a group, a certain proportion of those at each age may be expected to
die. A mortality table starts with a group of persons, as 100,000, at
a given age, as 10 years, and shows the number who die and the number
who survive at each year of age until all are dead. The table most
widely used in the United States is the American Experience Table of
Mortality, constructed by Sheppard Homans in 1868. The figures of this
table, at different years, are given below:

Age Number Living Deaths each year Death rate
per 1,000

10 100,000 749 7.49
20 92,637 723 7.80
30 84,441 720 8.43
35 81,822 732 8.95
40 78,106 765 9.79
50 69,804 962 13.78
60 57,917 1,546 26.69
70 38,569 2,391 61.99
80 14,474 2,091 144.47
90 847 385 454.54
95 3 3 1,000.00

The actual number of deaths of any group of insured will not
correspond exactly with the figures of any mortality table. But this
is not an essential defect of a table so long as the figures of the
table are approximately correct and are at least as great in the
earlier years as the actual mortality. For any excess of premium thus
collected but increases the safety of the insurance and reduces later
payments. In fact the mortality in nearly all companies in the United
States is much below the figures of the American Experience Table,
partly because of the influence of medical selection on the recently
insured and partly because of the decided improvement in longe