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place be liable to pay the said annuities, and in case they fell short, the land to be charged, with liberty given to the subscribers to revoke up to 4th Nov. then following.

Of £120,000 to be paid up before 9th Nov., £100,000 was to be laid out in purchasing £20,000 p.a. in reversions "on the lives in the Exchequer ;" and the remaining £20,000 to buy about £3000 p.a. in lottery tickets for 15 years which £20,000 p.a. in Reversion and the 3000 p.a. in possession for 15 years, is to be backt with £20,000 p.a. land, whereupon to grant annuities for one, two, or three lives, to the value of £20,000 p.a.; which at 11 years' purchase (the medium of the rates proposed) will come to £220,000, with £120,000 of which they proposed to purchase £17,000 p.a. more of lottery tickets, to make the first £3000 p.a £20,000 p.a. in possession; and the remaining £100,000 was to be lent to the land subscribers at 3 p.c. p.a., and the remainder of the profits was to be divided, viz., two-thirds to the subscribers of the £120,000 in money and one-third to the subscribers of £400,000 value in land, being £20,000 p.a. at 20 years' purchase; which (they say) by a modest computation may make 16 p.c. p.a. to the money, and near 30 p.a. on every 100 p.a. in land. And that the said fund might not fail, one-fifth part of the profits should during the 15 years be annually laid out to purchase something to answer those lives that may happen to be then left, of those that the reversions were purchased from the Exchequer.

It was, in a word, one of those complicated schemes of this period devised to evade the usury laws, and which broke down by reason of those very complications.

In 1698 an annuity project was set up by the Mercers Company, mainly at the instigation of Dr. Assheton. The scheme was for granting life annuities to the widows of the members at the rate of £30 for every £100 paid down by the member or subscriber. A scale was formed by which married men under 30 were allowed to subscribe £100; under 40, not more than £500; and under 60, they were limited to 300. A full history of this project will be given under MERCERS COMPANY.

In 1699 or 1700 another similar institution was formed, under the name of The Society of Assurances for Widows and Orphans, which has long since passed away. There were

probably several others.

The following lines are from the Postboy of 3rd Jan., 1698, and clearly relate to the annuity and other bubbles of the period.

We have methods wholly new,

Strange, late invented, ways to thrive,

To make men pay for what they give,
To get the Rents into our hands

Of their hereditary lands,

And out of what does thence arise,

To make 'em buy annuities.

We've mathematic combination
To cheat folks by plain demonstration,
Which shall be fairly manag'd too-
The undertaker knows not how.

In 1698 John Ward, of Chester, pub. a compendium of Algebra, and thereto was an Appendix concerning compound int. and annuities. But as the same writer goes into the subject more at large in another work, pub. 1710, we shall defer our analysis of his views until we arrive at that date.

In 1703 a money Act was passed-2 & 3 Anne, c. 3-in which life annu. were granted upon a similar plan to that in the previous Acts, but upon less favourable terms to the purchasers. In place of seven, eight and a half, and ten years' purchase, the prices were for one life at the rate of nine years' purchase, or for two lives at the rate of eleven years' purchase, or for three lives at the rate of twelve years' purchase (sec. 10). Annu. for 99 years were to be bought at 15 years' purchase. All the annu. granted under this Act were ultimately taken up by the South Sea Co.

In 1704 by 3 & 4 Anne, c. 2-An Act for raising monies by sale of several annu. for carrying on the present war-"natives or foreigners were entitled to exchange any life annu. purchased under the preceding Act into an annuity for 99 years certain, on payment of 6 years' add. purchase; or in case of an annu. orig. granted for two lives, and where one life had dropped, for 4 years' purchase; or in case of three lives for 3 years' purchase (sec. 3).

This persistence in imaginary estimates, notwithstanding that Dr. Halley had ten years previously illustrated the importance of distinction as to age, etc., portrays that the new doctrine of life-valuation was as yet but little appreciated, being prob. overlooked, or deemed still more fanciful than even the ordinary methods then in use.-Farren.

In 1706 the Amicable So. for Perpetual Assu. obtained its charter, under which there was power to grant life annu.

About the year 1707 a curious project was set on foot under the title of The Proprietors of the Traders Exchange House. The projector was Charles Povey, the founder of the Sun Fire Office. It was part of the scheme that at the end of the first five years, 50 of the poorest members were to receive an annu. of £10 for life; and after another five years, fifty others. [PROPRIETORS OF TRADERS EXCHANGE HOUSE.]

In this year was first pub. Smart's Interest Tables, of which we shall have to speak hereafter (see 1726).

At the close of 1709 a scheme was announced, which partook in some respects of the nature of a Tontine. Its preliminary announcement was headed: "The lucky 70, or the But the more matured project took the form following: A proposal for annu. for life, with the benefit of survivorship, such as the purses of the generality of

longest lives take all."

the people may be able to compass issuing out of the annu. granted by Parl. for a term of 99 years, and lottery annuities for 32 years, and the reversions of annu. Hence great profits will arise to such as shall live long, and an immediate income to all the subs. tax free, and payable half-yearly during the lives of their respective nominees. The least sum to be subs. is £10, but any contributor or such person as shall be employed by such contributor, may subscribe for as many sums of 10 as he or she shall think fit. Subs. are taken from 2 till 5 in the afternoon, at Haberdashers Hall, in Maiden Lane, near Wood Street, Lond., where may be seen the art. of agreements, the method in disposing of the subs. monies, and the allowances to the subs. of the first £20,000, and other particulars relating to the said proposal. Note-There are four subscription books marked A. B. C.D., that is to say, A. for nominees of any age; B. for nominees not under 20; C. for nominees not under 30; and D. for nominees not under 40 years of age.

This was, we believe, the first instance of any classification of ages being introduced. What was the fate of the project we do not learn. It is not surprising that outside speculators saw that money was to be made out of the Government annu. projects. But as every one could buy from the Government direct, there was not much need for the founding a special asso.

In 1710 there was a lottery drawn in Lond. consisting of 150,000 tickets valued at £10 each every ticket being entitled to an annuity for 32 years, the blanks to 145. p.a.; and the prizes to various annu. ranging from £5 to £1000.

The annuity-mongers of this period afforded some points for the satirists. selects a character whom he speaks of as Africanus :


One who has long been conversant in bartering; who knowing when stocks are lowest it is the time to buy, therefore with much prudence and tranquility thinks it the time to purchase an annu, for life. Again: Sir Thomas added he would have bought twelve shillings a year of him, but that he feared there was some trick in it, and believed him dead already!

In 1710 was pub. by John Ward, a little book called Clavis Usure: or a Key to Interest, etc., which confirms in a very marked manner some of the preceding details:

The way generally used in buying of annu. or letting of leases for lives, is only by an imaginary valuation grounded upon custom, and not upon any consideration that is had to the age of the persons whose lives are to be inserted in the lease, etc. 'Tis true indeed that there can be no certain rules prescribed for their true valuation, because the lives of all mankind are uncertain; and 'tis possible and daily seen that a young man may die before one of greater age. But yet there is a greater prob. of a young man's living longer than an old one; and not only so, but there's a proportional likelihood of the length of men's lives according to their different degrees of age. The which being duly considered, must needs be found of good use in estimating the values of annu, or leases for lives, much better than by a mere guessing only as usual; and that such a proportional likelihood is worth the consideration will appear from what follows.

He then recites Sir Wm. Petty's Use of Duplicate Proportion, afterwards adding by way of comment :

Thus you have a learned gentleman's opinion concerning the likelihood of the length of men's lives according to rules of duplicate proportion, which was a very ingenious thought of his. But I must beg pardon that I cannot agree with him in that part of it which asserts that 21 years is the age for whole life or lease is most valuable. For, although 'tis true that according to our law a man is said to be at his perfect or full age as to the enjoyment of an estate, or managing his affairs without a guardian, etc., yet I shall rather adhere to the close of his discourse wherein he says that he found that if the sum of all ages of the 330 souls (in a certain parish) being divided by their number, made the quotient between 15 and 16. Whence I take 16 to be the age for whose life a lease is most valuable.

Upon that supposition he calculated the following table, "according to the aforesaid rules of Duplicate Proportion":

This table (he says) shows by inspection the value of every five years of any single life from the birth to 71 years old. Supposing that any annuity or lease, etc., is really worth nine years' purchase for one life, which is according to the rate that the annuities settled by a late Act of Parl. for lives were valued at, and from thence the rest are computed.

He then notices Dr. Halley's estimate, and after inserting the relative table of annuities, adds:


Years' Purchase.



















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This table being of the same nature with that in page 107 (ie, the table above), there needs no other explanation or example to show its use, than what has been already said about that table: only here I must again beg leave to give my opinion about the difference of the proportions in the two tables, which is, that as the table in page 107 may not be thought a sufficient guide to be depended upon in estimating the length of men's lives, etc., because it's only deduced from the bare rules of art, viz., that of duplicate proportion; so on the other hand, I doubt the estimates of the value of any annu. taken from this table (i.e. Dr. Halley's), will be found too great in this country (viz. in England), which I much fear hath not so good or salubrious an air as that at the city of Breslaw, from whence these calculations are drawn. But if in imitation hereof, the curious in other cities and large towns would attempt something of the same nature; then without all doubt this method of estimating the prob. of the length of men's lives would prove the best, and become more universally useful than can be expected from this one single instance, more especially if such observations were continued for any considerable time, as 20 or 30 years successively. p. 111.

The above quotations from a little interest-book pub. in 1710 sufficiently illustrate that however much the subject of distinctive life valuations might be generally overlooked, yet that it was gradually attracting the attention of occasional writers.-Farren.

In 1711 Mr. Edward Hatton pub. his Index of Interest, and therein was contained : Tables showing by inspection the present worth of annuities, and the purchase thereof. Tables of the amount and present worth of any sum of money and of annuities to 61 years, and rules to apply them for 122 years. "Likewise easie rules for valuation of

1, 2, and 3 lives, etc., etc." This was the first attempt at popularizing the arithmetic of Life annuities-the first of many hundreds.

In the same year Mr. Thomas Langham pub. Tables of Simple and Compound Int. and therein was contained: Tables "whereby the amount or present value of any sum of money or any annuity, or lease, either in possession or reversion, from 1 year to 61, at the several rates of 3, 4, 5, 6, 7, 8, 9, and 10 p.c., is exactly calculated to the hundreth part of a penny;" but not a word concerning life annuities.

In the Post-Boy of 7th Feb., 1712, there was the following, by way of adv.: “If any person is willing to grant an annuity for Life upon good security, he may find one that has 2000 to lay out in that way. Enquire of Mr. Collins, Bookseller, at the Black Boy, over against St. Dunstons Church," etc.

In 1713 the legal rate of int. was reduced from 6 to 5 p.c., at which it remained from that period down to the abolition of the Usury Laws in 1854.

We now approach a period of more intense speculation in the matter of Life Annu. projects than any which we have yet passed. It was the period of the South Sea scheme, some six years preceding its grand but fatal climax. During this period any and every thing that could be associated with ins. or annu. seemed to find some measure of public support. The igenuity of honest projectors became in the end eclipsed by the daring audacity of bubble-mongers; but we must advance by gentle stages. Hardly anything in the way of ins. or annu. has been attempted during the century and a half which has since passed that was not in some form introduced or suggested at that period : hence the special attention which we call to it. When Mr. Fred. Hendriks, some years since, approached this period, he made the following judicious and almost necessary preliminary observation (Assu. Mag., vol. iv., p. 129):

The reader is presumed to be acquainted with the peculiar features of the hist. of the times when these subs. lists, and those of countless other projects, were formed and engrossed the attention and cupidity, not only of the trading classes, but of kings, nobles, clergy, and even of the fair sex, who had their 'Change hours in London, Paris, and Amsterdam. In the latter city there seems to have been almost as many insurance projects as in London.

Although we chiefly confine our attention in these pages to annuities on lives, we cannot pass over the fact of annuities being used as a means of raising cap. for the purposes of mercantile enterprise without some notice. The first announcement was the following, under date 5th January, 1714:

Given gratis at the Oil Annuity Office, against the Upper end of Montague House in Gt. Russel-st., Bloomsbury, a book entitled: An impartial account of the nature, benefit, and design of a new discovery and undertaking to make oil from the fruit of the beech tree. By authority of Her Majesty's Letters-Patents under the Great Seal of Gt. Britain. With answers to all that can possibly be said against it; and proposals for raising a stock of £20,000 upon annuities for 14 years at 50 p.c. p.a. upon a good and solid security.


On the 5th Jan. it was announced that the book of subscribers was open; and on the 21st of the same month that the subs. was complete. On the 1st March there appeared very lengthy proposals" signed "A. Hill," for the formation of a Beech Oil Co., by sale of 5000 shares at £5 5s. a share, which throws some light upon the "good and solid security" held out to the annuitants :

This company is in a pretty considerable state of forwardness, and some hundred shares are bought. Shares will be sold daily till 1st May next in the mean time, first payment to annuitants will become due Lady-day, amounting to £3750, and shall be discharged out of my own pocket. As to the 30s. p.a. p. share, which must be paid to certain annuitants, I own it would have been more to my satisfaction that there had been no occasion to pay the money: but the sharers will soon find that they have too good a bargain to complain for such a trifle.

Then on the 6th of May, same year, there were issued: Proposals for raising a stock of £100,000 for laying up great quantities of beech-mast for two years, at an int. of 45 p.c. p.a. to the subs.; and upon a security whereby they will always have in their own hands above ten times the value of the sum they contribute. To which is added a particular account of the nature, benefit, and design of the undertaking.

On the 26th Jan., same year, there appeared the following; and here the life element is introduced :

This day subs. will be taken for granting annuities (to raise a stock for improving the Fishery) in a method as advertised, and on a fund as good and well secured as ever was proposed, for £20 a year for Life, or 21 years, which shall first end, may be bought for £41, and a greater or lesser annuity in proportion. And that there may be no reason for suspicion or colour of fraud, the purchase-money will not be desired untill the subs. be complete, and directors chosen to receive it, and such as will pay double interest will be allowed 6 or 12 months longer; but no subs. will be received after 1st day of March next. The office is at the Crown in Fleet-street, near Water-lane, up one pair of stairs.

On the 2nd March, same year, there was another announcement introducing some modifications:

The subs. for raising a stock to improve the fishery by granting annuities of £20 a year for life, or 21 years, which shall first end, being near full, and those of £20 a year for life certain, and of £10 a year for life or 21 years, which shall first end, not above half full; and several persons declaring the time so short too inform their friends: until the last day of the month (if not full sooner) but no longer, annuities for £20 a year for life certain may be bought for £81, and those that remain of £20 a year for life, or 21 years, which shall first end, for £41; and £10 a year for £21, etc.

On the 2nd Oct., 1714, there was pub. in Lond. a proposal for settling jointures and granting annu. after the rate of 40 p.c. p. a. The scheme appears to have been built upon the plan of the Mercers Co.; indeed, the prospectus itself announces the fact:

The proposal now offer'd to the world has been maturely consider'd both by the proposers and

several of their friends, by whom they have been encouraged to make this publication. The certainty of the scheme is demonstrably evident, promising no advantage to itself from any precarious methods of gain, and must consequently be secure to subs., nor can it (as is presum'd) receive any disadvantage from the reputation of the proposers. Το prove that 40 p.c. is not rashly offer'd by the proposers, or without due consideration, tables are calculated to prove the scheme by the gradual increase and decrease of the annuitants, which being too long to be inserted, may be perused by the curious who will give themselves the time and trouble to examine them.

We, who write more than a century and a half after these proposals were framed and issued, are among the curious referred to, and have even at this remote period taken the pains to find, and given ourselves the time and trouble to examine them. We shall proceed to give the reader the benefit of the result; but before doing so, we must add the following note to the observations above quoted:

It was intended to have given 50 p.c., the design having been above a year in agitation, but the Parl. having since thought it necessary to reduce the rate of int., 40 p.c. is found to be as much as can reasonably be allowed.

Then there is added:

These proposals may be had gratis at the dwelling-house of the proposers, being four doors above the Rose Tavern, in Cursitor's-alley, fronting Castle-yard, at the White Balconey; where attendance is daily giv'n to take in subs. between the hours of 9 & 12 and 3 & 6, except on Sundays and holidays. We are now ready for an abbreviated outline of the actual scheme :

1. That any number of persons, either single or married, in seeming good and perfect health, will be admitted to subs. and pay to the proposers, certain sums of money on their own or the lives of others, at such times, and by such payments as are hereafter mentioned, for the benefit and use of their widows, or other their nominees who shall survive them.

2. That any married man in seeming good and perfect health above the age of 20, and not exceeding 30 years of age, shall, and may have liberty to subs., and pay the sum of one, two, three, four, or five hundred pounds on his own life, for the use of his wife if she should happen to survive him, or to the use of any other his nominee or nominees during the natural life of his said widow.

3. Any married man over 30, and not exceeding 40, in good and perfect health as aforesaid, might subscribe from £100 up to £400 for the like purposes.

4. Any married man between 40 and 50 might subs. up to £300.

5. Above 50 and not exceeding 60, up to £200.

6. That no person shall or will be admitted to subs. for the benefit or use of their widows or any other person or persons, he, she, or they, being above 20 years younger than themselves; nor will any person be admitted to subs. on the life of his wife, or the life of any other person for their own benefit, if the life so subs. on be above 20 years older than the person to receive benefit therefrom.

7. That any marry'd man may subs. and pay on the life of his wife of any of the ages before mention'd, the sums before nam'd, she being in seeming good health, for the sole use of himself, during his natural life if he should happen to survive her.

8. That any marry'd woman may subscribe, and pay on the life of her husband, of any of the ages before nam'd, he being in seeming good and perfect health, for the sole use of herself, during her natural life, if she should happen to survive him.

9. That any other persons, either marry'd or single, may subs., and pay any of the sums before nam'd, on the life of any person in seeming good and perfect health, and not above 20 years older than themselves, for their own use and benefit, during their natural lives, if they should happen to survive the life subscrib'd on.

10. That the subs. shall be oblig'd to pay no more than £6 5s. p.c. p.a. of the moneys so subscrib'd, and that for no more than one year, unless they think fit to continue it yearly, 'till the whole sum subscrib'd is paid in; viz., 16 years, if the person's life ins. on should so long continue.

11. That when the sum of £50,000 is subs., that is to say the yearly payments of £3125, the subs. shall be summon'd within six days, to choose and appoint trustees.

12. That within six days after appointment of such trustees, notice should be given to subs. to pay the first payment of £6 5s. to such goldsmith or banker as the said trustees shall approve of. The proposers would then settle a freehold estate of the full value of two-thirds of the moneys so paid in upon the said trustees.

13. That in regard the number of subs. is not limited, the proposers would further settle for every add. sum of £3125 paid in a freehold estate of two-thirds the value.

14. That as soon as such security shall be giv'n, and lands so settl'd, the remaining third part of all monies so paid in shall be vested in the hands of the proposers, to be by them made use of to the best advantage, and to be improv'd by such methods that the same may always be ready to pay the annu. on demand, or to purchase them of such annuitants, who shall think fit to dispose thereof, as after provided. The accounts always open to inspection of subscribers.

15. That the aforesaid things being done, the proposers would give their bonds to pay to the widows or other nominees, after the death of the subscriber, an annu. of 40 p.c. p.a. during their natural lives, according to the following TABLE-Which shows at sight the charge of each subscriber, and the profit their widows or other surviving nominees will receive in proportion to the number of years which they think fit to continue their payments. £ s.

The First




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16. Every person at time of making proposal to express names and ages of their wives, or other nominees.

17. That no soldier that goes to the wars, marine, or sea-faring man, shall be admitted to subs., or pay any money to these proposers, tho' they will not refuse any person that shall, or may, have occasion to travel thorou Gt. Britain, France, or Ireland, or any of the coasts thereof, provided they do not settle their habitations there, that then they will be admitted, and their widows, or nominees be justly paid their annuities.

18. Widows or nominees to give notice of the death of the subscriber within one month, and produce certificate signed by the minister, parish clerk, or churchwardens of the parish where deceased dy'd or was bury'd.

19. That if any person whose life is subscrib'd on shall voluntarily make away his or herself, or by any act of theirs occasion their own death, or by duelling or committing any crime whereby they may be put to death by the laws of the land, that then, and in either of the said cases, their widows or other their nominees shall receive no annuity, but their subscription money shall be repaid them, on delivering up the proposer's bond to be made void and cancell'd.

20. The first payment of annuity to be made on the next feast of the Blessed Virgin Mary, or of St. Michael the Arch-angel, which shall first happen after the decease of the person whose life was subscrib'd on, and due notice thereof giv'n to the proposers, after the rate of 40 p.c. p.a. for all money they shall have paid, and will continue to be so paid half-yearly, during their natural lives, without charge or deduction.

21. If any persons discontinued or neglected to pay their subscriptions in the month of June in every year, such persons should not be admitted to pay the same afterwards on that life, but should only receive their annu. for so much as they had paid in after the rate of 40 p.c.

22. The subs. to give a bond to deliver up the proposers' security for the annu. within one month after death of annuitant.

23. If annuitants could not attend to receive their annu., certificate must be sent, signed by minister and parish clerks or churchwardens, that the annuitant was living, and where.

24. Notice to be given of change of abode of annuitants.

25. The proposers thereby obliged themselves, their heirs, and assigns, for the first five years, in case the person or persons entitl'd to receive these annu. were in seeming sound and perfect health, to purchase the same if requir'd, paying therefor after the rate of 6 years' purchase, provided they are willing to dispose thereof the first year, and to discount what previous half-yearly payments they shall have receiv'd.

26. The subs, to be entitled to new bonds from the proposers for each yearly subscription paid. 27. Every subscriber at the time of making his subs. to pay is. in the £, that is to say 6s. for every 66 5s. to be paid by them on the first call, and so on annually during their subscriptions, the like sum of 6s. for the sole use and benefit of the proposers.

The following are some explanations of the scheme which seem important. (without abbreviation)


The following scheme is calculated on a supposition of the death of one person in ten every year, and only for 500 persons, and in the first year's payment; nevertheless, there will remain at the end of 24 years the sum of £1786 165. od., and the annuitants will then be reduced to 35 persons, who will decrease gradually till all are paid off,

It was thought advisable to allow the death of one in ten every year, though it is presum'd 'twill never happen, there being always allow'd by Sir Wm. Petty, and the ingenious Dr. Halley, but one in 30 or 40.

However, 'Twill be more excusable to err in the allowance of a greater number of deaths than the contrary, because most calculations of this nature have hitherto been too favourable to the projectors, and these proposers are more desirous to ascertain the security of the subs. than their own profit. Most virtuous, most noble, and most foolish proposers! Then here follows what they term the SCHEME:

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