In both unions the per capita cost of the benefit was relatively high at the outset, chiefly on account of the larger size of the benefit, but partly on account of the laxity of the rules governing its administration. In the Carpenters the wife's funeral benefit of twenty-five dollars and fifty dollars to members in good standing for six months and one year, respectively, costs each member about fifteen cents annually. The cost of the seventy-five dollar wife's funeral benefit in the Tailors' Union ran in the first year as high as eighty-six and two thirds cents. At the time the benefit was abolished the amount paid was practically the same as that now paid by the Carpenters and the per capita cost had fallen to about seventeen cents in 1896. It may fairly be concluded that a wife's funeral benefit of twenty-five dollars will cost each member of the union about fifteen cents annually.
The consideration of the cost of the death benefit has been deferred until an examination of the cost of the disability benefit and of the wife's funeral benefit had been made, since the member's death benefit, the disability benefit and the wife's funeral benefit are regarded in the unions with the most highly developed systems as parts of a single benefit. In only a few unions are the payments for these several purposes separated. The unions thus differ so widely in the character of the death benefit paid that it is impossible to institute any comparison as to the relative expense of maintaining the benefit. Some of the systems combine death and disability benefits, some group the death and disability benefits, some pay a wife's funeral benefit while others do not. It will be possible to describe certain typical systems and to indicate the cost of the benefit in the particular system and certain general differences.
The death benefit of the International Typographical Union may be regarded as the simplest type. The greater number of the death benefit systems found in American trade unions are of this general character. The union pays a benefit on the death of any member in good standing. It pays no wife's funeral benefit nor any disability benefit. The benefit, when established in 1892, was fixed at sixty dollars, and has since been raised to seventy dollars in 1906. The annual per capita cost of the benefit has never exceeded eighty-four and has averaged less than eighty cents. This extremely low rate has been due to the large number of lapses. The beneficiary system of the union has not been highly developed and members of the union quitting the trade drop their membership. There is no sort of provision whereby members may retain their beneficiary rights on the payment of less than full dues. Only a small part of the dues are devoted to beneficiary purposes. The net result in such systems is that the members of the union get insurance at a low rate at the expense of those leaving the trade.
A second type is that of the Brotherhood of Carpenters. In their system, death and disability benefits are combined and a benefit is paid on the death of a member's wife. The benefits are graded but the maximum amounts are not large. The following table shows the system as a whole:
| BENEFICIARY SYSTEM OF THE BROTHERHOOD OF CARPENTERS. | ||||
|---|---|---|---|---|
| Member's Death Benefit. | Wife's Death Benefit. | Disability Benefit. | ||
| $100 on 6 months' membership. | $25 on 6 months' membership. | $100 on 1 year's membership. | ||
| $200 on 1 year's membership. | $50 on 1 year's membership. | $200 on 2 years' membership. | ||
| $300 on 3 years' membership. | ||||
| $400 on 4 years' membership. | ||||
The per capita cost of maintaining this system, adopted in 1882, has varied greatly from year to year. In 1895 it was as high as $2.46, while in 1900 it was as low as eighty-one cents. The explanation of this variation lies in the changes in the number of members and consequent changes in the age grouping. When the membership was at its lowest point in 1895 those who retained their connection with the organization were to a considerable extent the older members who were desirous of keeping their insurance. The number of claims (death, wife's death and disability) in 1895 was sixteen per one thousand of membership. In 1900 when the membership had doubled the number of claims per one thousand of membership was thirteen and in 1906 it was nine. The average amount of a claim in 1895 was $133, while in 1900 it was $105. In 1906 the average amount of a claim was $125.
Two deductions may be made from these statistics. The Carpenters have heretofore been unable to retain their membership in dull times. The result has been that the death rate has been lower and the average amount of the claims less than it otherwise would have been. The increase in membership in prosperous times results also in decreasing the average amount of the claims, since in such periods the mass of the members have not been long enough in membership to entitle them to more than the minimum benefits. The benefits furnished by the Carpenters and other unions with similar systems of benefits are provided at less than the cost would be in organizations with stable membership. The per capita cost of $1.23 in 1906 is far below the actuarial cost.
The Typographia and the Cigar Makers are typical unions of the third and final class. In these organizations there are highly developed beneficiary systems. The members receive not only death benefits but out-of-work and sick benefits. In both unions the membership is stable. In the Typographia periods of depression and prosperity do not affect the number of members. In the Cigar Makers the increase in members is checked in hard times but no decrease is suffered. In such unions the per capita cost of the death benefit is not lowered by lapses to any appreciable extent.
The death benefit in the Typographia includes a member's death benefit graded from sixty-five dollars to two hundred dollars, a wife's funeral benefit of fifty dollars and a disability benefit varying according to the age of the member. This combination of benefits costs to maintain on the average about three dollars. The cost varies considerably from year to year on account of the small number of members, and the consequent lack of regularity in the death rate, but taking five-year periods, the cost is stable.