Frank Preston Stearns, Cambridge Sketches

The situation was this, and Mr. Wright saw it clearly: the presidents of the companies were excellent men,--as honorable and trustworthy as the presidents of our best national banks,and they knew how to organize and conduct their companies in all business matters, but of life insurance as a science they knew as little as they knew of Greek. In those days there was a prejudice against college graduates which prevented their obtaining the highest mercantile positions, and it is doubtful if there was any person connected with the life-insurance companies who could solve a problem in the higher mathematics. The consequence of this was that it placed the presidents quite at the mercy of their own accountants. Recent events have proved with what facility the teller of a bank can abstract twenty or thirty thousand dollars without its appearing in the accounts. Temptations and opportunities of this sort must have been much greater in life-insurance companies, as they were formerly conducted, than it is now in banks. Money may have been stolen without its having been discovered.

Besides this, the temptations of the companies to continually over-bid one another for public favor was another evil which, sooner or later, would lead some of them into bankruptcy. This danger could only be averted by placing their rates of insurance on a scientific basis, which