On consulting my friend the late Francis Baily, F.R.S., who had himself practised as an Actuary, he strongly advised me to accept the office. He assured me that the profit arising from private practice could scarcely be less than 1,000 l. a year, and would probably be much more.
Under these circumstances, I accepted the proposition. On examining the materials which existed for a Table of the value of lives, I found in one of the addresses of Mr. Morgan, the Actuary of the Equitable, materials with which to construct, by the aid of various calculations, a very tolerable Table of the actual mortality in that Society. Upon this basis I calculated the Tables of our new Institution. After three months’ labour, when the whole of the arrangements had been completed, and the day for our opening had been fixed, circumstances occurred which induced us to give up the plan. After the experience I had now had of the amount of time occupied by such an office, I was unwilling to renew the engagement with other parties. I hoped by great exertions to complete the Difference Engine after the lapse of a few years, and that I should not be allowed to become a serious loser by that course.
The Institution was therefore given up, and we each contributed about 100 l. to discharge the expenses incurred.
Within the subsequent twelvemonth, an application to take {476} the management of another Life Assurance Society was made to me, which I declined. That office is still in existence.
The information and experience I had thus gained led me to think that the public were not sufficiently informed respecting the nature of assurances on lives, and that a small popular work on the subject might be useful. I prepared such a work as intervals of leisure admitted, and early in 1826 published it under the title of “A Comparative View of the various Institutions for the Assurance of Lives.” This little volume was soon translated into German, and became the groundwork upon which the Great Life Assurance Society of Gotha was founded. Every year since that event I have received a copy of the report of the state of the Institution—a gratifying attention which I am happy to have this opportunity of acknowledging.
The wish expressed by my translator, in his Preface,[64] has also been fulfilled by the establishment of many other excellent Life Assurance Offices, founded on similar principles.
[64] “May this book soon give rise to many flourishing life assurance companies in our beloved fatherland, by which proportionate wealth and happiness may be promoted amongst us, and at the same time prepare for the decline of lotteries.”—German translation of Babbage on Life Assurance.
〈GERMAN ASSURANCE COMPANIES.〉
In Germany alone there were, in 1860, twenty-four Life Assurance Companies, in which about 260,000 persons were assured to the amount of upwards of forty millions sterling. The oldest and most successful of these institutions have adopted my Table of the Equitable experience, and I am informed that it agrees very well with the results of their own experience up to about the fifty-seventh year. After this the deaths are rather more frequent than those of the Equitable.
Another still more gratifying result arose. My father, whose acquaintance with mercantile affairs was very {477} extensive, was so pleased with the little book that, during the two last years of his life, he read it through three times.