Similar depictions are found in all fields of insurance. No property owner is completely certain that his title is strong and no one would be willing to put forth a single prediction about it when it comes to personal judgment, however correct, could be wrong. But given an adequately large collection of risks underwriters are eager to transform uncertainty into certainty by conceding protection in return for a predetermined premium.

No merchant is aware for sure when a particular debtor's account might need to be written off as a "bad debt," or how much he stands lose on a personal debtor, but in many areas of business the standard loss through bad debts is about completely certain. When an assortment of risks thus increases the firmness of the future it becomes feasible for the manufacturer to take away his doubts by the acquisition of a credit insurance policy.

The law of most States holds a business responsible for payment to hurt employees, usually specifying precisely the amount to which the individual employee is allowed; but even in the major plants it is complex to guess the entire amount which will be compensated in any given year.

But by accounting for, for instance, all steel plants in America, we can come to a much more precise finale and through compensation private health insurance can wipe away this element of possibility from the employer's company. Generally most business men would confess that nothing is more vague than the law, and yet they suppose a legal liability when they authorize a salesman to go into their premises, when they dangle a sign over the path, operate an industrial unit with windows opening on the lane, and perform many other acts without a consideration of the component of risk thereby brought up.

A public liability policy would turn many of these reservations. So we might go on to exemplify the element of doubt in the operation of a vehicle, in an operation executed by a doctor, in the function of an elevator, in the presence of a plate glass window, the operation of a steam boiler, and the mailing of a package by parcel station, in all of which the doubt, or at least a significant part thereof, may be completely erased by the introduction of insurance.

It is the failure entirely to welcome this principle that causes people so often to insure their possessions but to overlook their life insurance, to enlighten themselves of their liability under reimbursement acts, yet take no notice of their liability to the public. Plenty has been said, nevertheless, to show the outcomes in the elimination of risk made accessible to the individual and the business owner. If all ambiguity could be removed from business, profits would be definite; insurance removes much insecurity and to that degree is profitable.

Insurance improves business competence-the natural result of the removal of risk and ambiguity is an increase in business effectiveness. Every producer knows that if it were feasible for him to lessen the uncertainties of his industry by 50% his efficiency as a commerce unit would be at the very least trebled. The cost of goods is often used as an index to the competence of their production and allocation, and it is well known that the slighter the risk involved, the lesser the price it is achievable to charge.

The most doubtful businesses are in the foremost the most incompetent ones; for the exis¬tence of the huge element of doubt minimizes the significance of the countless small factors which make up the summation total of effectiveness. With a few bigger risks out of the way the business owner is able to dedicate his concentration to those minor perfections which award him an advantage over his competitors. This makes the idea of cheap auto insurance that much more relevant.

For example, suppose that a young individual has gathered a small amount of wealth and is given an opportunity to invest this amount of capital in an exporting commerce. He may be very certain of the achievement of this industry and would be prepared to risk his opportunity in it without thinking twice. But he considers the danger accompanying ocean transportation and the hazards of inferno and fraudulence.

His investment symbolizes a growth acquired by reduction and tough labor, and when he ponders the likelihood of flames, of shipwreck, of harm to the goods by the sea, etc., he becomes reluctant to put his capital in jeopardy unless insurance is introduced as a kind of protection. With this guarantee he is a resourceful business individual, without it he is a risky gambler heckled by uncertainty and indecision.

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The scene for Metropolitan Life Insurance Company began to shift around 1905-a year of great import in American life insurance history. For some time it had been clear to leaders of public opinion that all was not well with the practice of life insurance as it had been conducted by some of the larger companies. In that year the New York Legislature appointed a joint committee, with Senator William W. Armstrong as Chairman, to make a sweeping inquiry into every phase of the industry.

The inquiry concentrated upon the alleged mismanagement of the companies, their vast accumulations of wealth, their treatment of policyholders, their cost of operation and administration, the methods and character of their investments, their legislative activities, and practice of contributions to political parties.

The investigation was conducted by distinguished counsel headed by Charles Evans Hughes, later Governor of the State of New York and Chief Justice of the United States Supreme Court. Much that was unsavory was disclosed in the activities of some, though not all, of the larger companies. The report of the investigation was followed by drastic legislation which cleansed the business of questionable practices which had sprung up during the years.

Two decades later the business had earned from Mr. Hughes, in an address before the Association of Life Insurance Presidents, the commendation: "1 believe that there is no safer or better managed business in our country than yours." In so far as the Metropolitan itself was concerned, the Armstrong investigation and the legislation which ensued were, with exceptions mentioned below, a happy vindication of the practices which the company had previously established. Tontine, or deferred dividend insurance, which Mr. Fiske had proscribed when the Ordinary Department was reestablished in 1892, was outlawed. Expenses in the acquisition of new business were definitely limited.

When other companies argued that the restriction of expenses imposed a hardship upon them, the Legislative Committee cited the Metropolitan as an example that business could be done within the proposed limits. As regards industrial life insurance, the committee referred to what were called "serious evils which have been disclosed by this inquiry," but stated that it was not prepared to make recommendations with reference to that business. This was regarded by Mr. Fiske as a personal triumph.

He had impressed the committee with his views as to the importance of industrial life insurance as an institution and with the value of the service which it rendered, and he had urged that the companies be permitted to seek remedies of the features criticized, without legislative interference.

The only applicable changes in the law were to put the reserve liabilities on the basis of Metropolitan Industrial mortality, and to provide paid-up values to lapsed policies after three instead of after five years. The result of the investigation as a whole was to add to the prestige of the company, a fact evidenced by the sharp increase in its business in the years that followed.

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