Metropolitan Life Insurance Company's Affect on Death Rates
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By :
Ruca Martin
Submitted
2008-09-15 15:00:59 |
It is no wonder that the plethora of services Metropolitan Life Insurance Company provided favorably affected the life and health of the insured. Almost from the very beginning the mortality of industrial policyholders reflected the effectiveness of the welfare campaign. Death rates began to retreat more rapidly for these insured than for the rest of the population.
The mortality figures for industrial policyholders in the early 1900’s were about half what they were at the inception of the effort. Among children the saving in mortality was about 75%. The average child born at that time could expect to live 16 years longer than the one born a generation ago. These dramatic figures and the human values behind them attracted worldwide attention.
They gave tremendous stimulation to official and voluntary health activities on behalf of the entire nation. The welfare service more than paid for itself in deaths postponed, in many homes made happier, and in the ever increasing social point of view which motivated the life insurance (http://www.equote.com/li/termlifeinsurance.html) agent.
The culminating achievement of the administration at the time was the completion of the mutualization of the Metropolitan in 1915. In the beginning the company was organized as a stock venture, as a business conducted for profit. That was in line with the spirit of the times, which encouraged the investment of capital for business expansion.
Yet no one could have foreseen the extraordinary success of the organization, its rapid growth in number of policyholders and in assets, and the consequent influence of its position. It was exceedingly fortunate that the Charter of the Company limited the dividends of stockholders to 7% on their investment. Although the business ran into billions of dollars, piling up sizable reserves and surpluses, the stockholders were prohibited by charter from ever receiving more than $140,000 a year on the $2,000,000 of stock.
Yet the danger was ever present that, in some future administration, efforts might be made to obtain control of the company through purchase of a majority stock interest. There might thus result a directorate and management which would not so zealously protect the interests of policyholders, making such luxuries as occupationally available low cost life insurance, http://www.equote.com/info/life-insurance-info.html, a thing of the past. The administration realized this danger keenly; and Mr. Ecker, who then was Treasurer, was given the opportunity to carry on the mutualization negotiations with the stockholders.
A word must be said for the generous and broadminded attitude of Joseph P. Knapp, son of the former President, and one of the most active of the Board of Directors. His readiness to turn in his large stock holdings at the modest figure of $300 per share made a solution favorable to the policyholders quickly possible. Through payment of only $6,000,000, the Company once and for all removed any obstacle which stood in the way of complete ownership and control by its policyholders.
Such a fundamental transfer had been the hope of the administration for a long time; and in completing these delicate negotiations, the farseeing judgment of the management was demonstrated. From then on no individual could control the life insurance company (http://www.equote.com/li/term-life-insurance-quote.html) against the best interests of the policyholders who composed it. The officers and the staff were their employees not only in form but in substance; and thus was achieved the underlying democratic principle inherent in mutual life insurance.
The president at that time died in 1929, and was succeeded by Frederick H. Ecker, who, since 1883, had been in turn Office Boy, Clerk, Manager of the Bond Department, Comptroller, Treasurer, a member of the Board of Directors, and Vice President. For 20 years he had shared with the president the responsibilities of administration. As the investment officer of the company, he had guided the finances of the organization along constructive lines, assuring stability and sound business methods in the control of the company’s assets.
He had achieved a notable position not only in the insurance world but in that of finance. He had become expert in the diverse problems of urban real estate, and especially its complexities in New York City. His advice was widely sought by leading railroads, and he was particularly constructive in reorganizing those in financial difficulties. In all these transactions he had safeguarded the interests of the company, setting it up for what seemed like a successful future. |
Author Resource:-
Sarah Martin is a freelance marketing writer specializing in business, financial planning, and low cost life insurance. For a life insurance quote without exam, please visit http://www.equote.com.
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