the members of which should devote their entire time to the administration of the compensation law. 7. Provision should be made for the settlement of compensation claims either by agreement subject to the approval of the accident board, or if no agreement is reached, by arbitration, with an appeal to the accident board. Appeals from the decrees of the accident board should be allowed only on questions of law. 8. Provision should be made for full and accurate reports of all industrial accidents. Occupational diseases are not included by the compensation laws of the several states, although the Supreme Court of Massachusetts has construed such diseases to be injuries entitling the employee to compensation. In Michigan, however, the contrary view has been taken. Sickness Insurance. - Compulsory sickness insurance has been introduced in about one half of the large countries of Europe and voluntary subsidized sickness insurance in others, but we have so far left practically everything in this direction to private effort, although there are state miners' hospitals in five states and the federal government conducts a hospital service for seamen. Many students of the subject believe that sickness insurance will never be made effective unless it is made compulsory. It is significant that Great Britain, where the traditions, as in the United States, are against compulsion, made sickness insurance compulsory by the act of 1911. The majority of workers, by virtue of being employed, are assured certain benefits in case of illness, the cost of the insurance being met. partly by the government, partly by the employer, and partly by deduction from the employees' wages. In Germany, where a system of compulsory sickness insurance was established as early as 1883, one third of the cost is borne by the employers and two thirds by the employees. The sickness insurance benefits in that country cover also the care in whole or in part for the first thirteen weeks of those injured as the result of industrial accidents, after which time the accident benefits are paid wholly from accident insurance funds, and include maternity benefits, funeral benefits, and sometimes sick benefits for the members of the family other than the insured. Maternity benefits were added in England by an amendment in 1913. We have need for similar laws in this country and the framing of such laws may be looked upon as the next step in social insurance here. ⚫ Old Age Insurance. We are familiar in the United States with a pension system growing out of past wars and with local pensions for firemen and policemen. Other countries have provided in a much more general way by pensions, subsidized voluntary insurance, or by compulsory insurance for the relief of persons incapacitated by old age. Invalidity and old age insurance is one of the three great branches of the German insurance system. It covers the great majority of the wage earners of both sexes. There are contributions in equal amounts by the insured workmen and their employers and a yearly addition is made to each pension by the government. The English law of 1908, on the other hand, provides for a straight pension to persons 70 years of age or over whose incomes are below $153 a year and who have not certain disqualifications mentioned in the act. The amount paid varies from 24 cents to $1.20 a week. The British system resembles poor relief more closely than insurance. For years an attempt has been made to induce the United States government to adopt an old age pensions system for its employees, but there has been radical difference of opinion as to whether such a system should be with or without contributions by employees. In this, as in the more general problem, a noncontributory pension may be the more advisable at the start, but a contributory old age insurance system is doubtless more desirable as permitting of more liberal incomes and as encouraging thrift. - Unemployment Insurance. The solution of the problem. of unemployment involves much more than insurance. The progress of industry should be made less irregular and men and opportunities for work should be brought together more readily. Attention is being turned at present in the United States to the establishment of a national system of labor exchanges. It is not to be expected, however, that unemployment can be eliminated. It is a misfortune which should be provided against by insurance. Many European cities have made experiments in this field which have left much doubt as to the practicability of insurance as a general remedy for the evil of unemployment. But the British National Insurance Act of 1911 has instituted a great experiment which is tending to remove this doubt. By that act persons engaged in building, construction of railroads, docks, or canals, shipbuilding, iron-founding, construction of vehicles, and saw-milling are entitled to receive unemployment benefits. About a quarter of a million of persons are covered by the act. The cost of this insurance is met by contributions from employers and employees and partly from appropriations by Parliament. Life Insurance for Workingmen. - Our private life insurance companies are selling a good many policies which are payable, not as lump sums, but in installments or annuities, to the survivors of the insured. Wage earners cannot often afford to purchase such policies, but the same object is to some extent attained by widows' and orphans' pensions. Beginning with 1912 such pensions have been made a part of the German insurance system. In the United States many state laws have recently been enacted providing for pensions to mothers in need of relief. While these American acts are to be viewed as a form of poor relief, they are significant as possible forerunners of a comprehensive system of workingmen's life insurance. Objections to Social Insurance. — Aside from questions of constitutional law, social insurance is met with the following difficulties: (1) It implies a considerable addition to the wages bill and it has been urged that it is unfair to place this burden on the employers of one state unless similar burdens are placed on employers of other states. (2) It is contrary to the economic philosophy of those who wish to see state activity reduced to a minimum. (3) It has been charged that social insurance discourages thrift and that it leads to demoralization because it encourages malingering and staying at home for trivial ailments. Cases are cited in which a maternity benefit was spent on liquor by the husband, and one man is said to have spent the maternity benefit in the purchase of a graphophone. It should be noted, however, that all insurance is subject to abuse. Who would question the beneficence of fire insurance because it leads in some cases to incendiarism? Fire insurance companies do a good deal in the way of fire prevention. Similarly, not the least important aspect of social insurance is its relation to the conservation of the national health. The employers' associa tions in Germany organized for accident compensation have done much for accident prevention, and a system of sickness insurance gives timely medical and adequate care to many who now waste their money on patent medicines. 1. Define insurance. QUESTIONS 2. What is a mortality table? 3. How would you find the premium for insuring a group of persons for one year for $1000 each? 4. Distinguish between reserve and surplus. 5. What is a "pure" endowment policy? 6. What are the advantages and disadvantages of assessment insurance? 7. What has been New Zealand's experience with State insurance? 8. What is meant by the "moral hazard"? 9. What are tontine policies? 10. Why is the "fellow-servant doctrine" not suited to modern conditions? 11. Discuss the possible effects of social insurance on wages. 12. Are old-age pensions a form of insurance? ALEXANDER, WILLIAM. The Life Insurance Company. American Labor Legislation Review: "Social Insurance," June, 1913; "Sickness Insurance," March, 1914 Annals of the American Academy of Politi Insurance. DAWSON, W. H. Social Insurance in Ge FOERSTER, R. F. nal of Econo FRANKEL, L. K FRICKE, W. A GEPHART, W. GIBBON, I. G. GOW, WILLIAM. Marine Insurance. HUEBNER, SOLOMON. Property Insurance; Life Insurance. Massachusetts Commission on Old Age Pensions, Annuities, and Insurance. Report, 1910. MOIR, HENRY. Life Assurance Primer. New York Insurance Investigating Committee. Report, 1905 (6 vols.). RUBINOW, I. M. Social Insurance. SEAGER, H. R. Social Insurance. The Insurance Year Book, Annual (2 vols.) United States Bureau of Labor Statistics. Bulletin, Nos. 101, 102, 103, 107: 109, 126, and 155. United States Commissioner of Labor. Twenty-fourth Annual Report. ZARTMAN, L. W. The Investments of Life Insurance Companies. |