Papers and reports

If a pebble on a steep hill is disturbed from a state of rest, it will probably roll down the hill gathering speed as it goes, and, if the hill ends in a precipice, the pebble will, unless it is checked in its course, eventually fall over the edge. So long as the pebble is rolling down the hill it is within sight of an observer on the hill, but when it falls over the precipice it passes out of his sight; its disappearance occurs suddenly.

The subject of sickness insurance does not appear to have been previously discussed before this Institute except in relation to Friendly Societies and the National Health Insurance Act. There is, however, a most comprehensive paper by Mr W. A. Robertson, the present President of the Faculty, in the Transactions, Vol. 16. Disability in the sense of long-term sickness insurance has been considered on several occasions, but purely as an added benefit to life assurance contracts.

The Indian Insurance Act (Act IV of 1938) was introduced into the Legislative Assembly on 26 January 1937. It was immediately circulated for opinion, prior to its consideration by a Select Committee of the Assembly in Simla, in August 1937. After very lengthy discussions in the Legislative Assembly and subsequently in the Council of State, which were remarkable for the interest and keenness shown by members in the details of the measure, it was passed on 17 February 1938 and received the Governor-General's assent on 26 February. It comes into force on a date yet to be announced.

My intention is to give some simple illustrations of the difficulties which arise when the market rate of interest has sunk below the limit of solvency for parts of a company’s stock of life contracts. In fact, the ßpartial liquidationà which at such a contingency would appear most natural to the unbiased mind of an actuary, does not seem to be seriously contemplated in insurance legislation. As regards Sweden, this mathematically correct reduction of the liabilities of some of the contracts could perhaps be realized within the legal frame in Mutual Offices.

It is now nearly a decade since the author had the honour of submitting a paper on the mortality of assured lives in India, and the manner of its reception by the members of the Institute has emboldened him to make a second venture.