reserve

Where level premiums are paid, the amount of the annual premium is necessarily greater than the mortality cost during the early years of the insurance and less than the mortality cost in later years. With the mortality table and an assumed rate of interest on the investment of premiums received, the amount of the accumulated savings on this basis, at any date, can be mathematically computed. This amount constitutes the 'reserve' against the policy or its net value.

The National Bank Act directs that all national banks in the sixteen largest cities shall at all times have on hand, In lawful money of the United States, an amount equal to at least twenty-five per cent, of the aggregate amount of its notes in circulation and deposits. Fifteen per cent, is required of all other national banks. When three-fourths of the national banks in any city of 25,000 inhabitants apply to the comptroller to be added to the reserve cities, he may grant their request and thereafter the banks in such city shall maintain the twenty-five per cent, reserve. Act of March 5, 1903. When the reserve falls below the proper limit, the bank must not increase “its liabilities by making any new loans or discounts,” otherwise than by discounting or purchasing bills of exchange payable at sight, nor make any dividend, till the limit is reached. On a failure to make good the reserve for thirty days after notice by the comptroller of the currency, the latter may, with the concurrence of the secretary of the treasury, appoint a receiver to wind np the bank. R. S. § 5191. See National Banks. In Insurance Law. That part of the premiums on a policy, with the interest thereon, which is required to be reserved or set aside as a fund for the payment of the policy when it becomes due. Richards, Ins. L. 20. An insurance company is deemed to be solvent when Its reserved funds, invested at a specified rate of interest, will suffice to meet the payments on its policies as they shall mature. As a factor of safety, the rate of interest is usually fixed very low. Under the statutes of many states insurapproved by some state officer, usually an insurance commissioner, to an amount specified which is termed the reserve fund; Biddle, Ins. § 66. They are held not to apply to relief associations where the assessments are purely voluntary; 11 Ins. L. J. 859. The securities which compose a reserve fund are in the nature of a trust fund for the policy holders, and not a security for the general creditors; Faljienbach v. Patterson, 43 Ohio St. 359, 1 N. E. 757; Relfe v. Life Ins. Co., 76 Mo. 594; Moies v. Mut. Life Ins. Co., 12 R. I. 259; and a receiver appointed in case of the insolvency of a company is not entitled to control it, but securities are held in trust for distribution by the trustee; Cooke v. Warner, 56 Conn. 234, 14 Atl. 798. After the policy holders are satisfied, the securities, if the property of the company, may be applied for the benefit of general creditors; Moies v. Mut. Life Ins. Co., 12 R. I. 259. In many states such fund is required as a prerequisite to permission to a foreign insurance company to do business in the state, and ordinarily the deposits required by such laws are for the benefit of domestic policy holders; In re Life Ass’n of America, 91 Mo. 177, 3 S. W. 833; Bockover v. Life Ass’n, 77 Va. 85; State v. Benton, 25 Neb. 834, 41 N. W. 793; 17 U. C. Ch. 160. Another use of the term is its application to a fund sometimes called the safety fund and sometimes a reserve fund in policies issued by companies which provide for an assessment to meet the losses. Such fund is intended for the protection of living members by the use of the income for the payment of dues and assessments; 2 Joyce, Ins. § 1287. Where a reserve fund and the mortuary and benefit fund were to be raised by assessments, the latter being for the payment of death claims only and the former for the exclusive use of members, except that it might be used in payment of death claims when they exceed the experience table of mortality, it was held, upon dissolution, that the reserve fund was to be distributed exclusively among the holders of certificates in force, and that death claims had no right to share in it; In re Equitable Reserve F. L. Ass’n, 131 N. Y. 354, 30 N. E. 114. In a policy on the Tontine system (see Insurance, subtitle, Tontine), where, in addition to the provision for the payment of death claims, is was provided that in case the policy holder survived the specified period and the policy remained in force, there should be a payment in cash or annuity bonds from a fund created by a certain class of policy holders consisting of those effecting insurance on the same plan and in the same year, the surplus and profits to be equitably apportioned among survivors of that class, it was held that the policy did not require a separate investment of these funds and that Its obligations in that respect; Bogardus v. Life Ins. Co., 101 N. Y. 328, 4 N. E. 522. The term reserve in life insurance is also applied to the fund accumulated out of premiums after the payment of expenses and other charges properly apportioned to each policy, and where a life policy provides that, in case of lapse for non-payment of premium, the net reserve, less indebtedness, shall be applied to the purchase of extended insurance, or, if the assured shall so elect within three months, to the purchase of a paid-up policy, and also that said indebtedness may be paid in cash, and the entire net reserve so applied, such indebtedness must be paid within the three months; Omaha Nat. Bank v. Life Ins. Co., SI Fed. 935. Paying to the insured the reserve on his life policy, taking no promise to re^ay it, but with an agreement that it will be extinguished automatically by a charge against his reserve, is a payment, not a loan; Parish Orleans v. Life Ins. Co., 216 U. S. 517, 30 Sup. Ct. 385, 54 L. Ed. 597.

To withhold; to hold back.

!). To keep back; to withhold. Reservation: the act of keeping back or withholding; also, the clause in a conveyance or contract whereby some part of the subject-matter is kept back or withheld from the operation of the instrument. Reservation, or reserve: a portion, particularly a tract of land, kept back or withheld. 1. The words often occur in their general sense of keeping back; as when 2. More technically, a clause of reservation, or a reservation in a deed or lease, is a clause whereby the grantor or lessor reserves, either to himself or to the lord of the fee, some money, chattel, or service, not being part of the thing granted or demised, or an appurtenant thereto. It is considered that reserva- 'lion, in the strict sense, cannot be made in favor of a stranger, although such, if attempted, might be good as a condition. And it follows from the definition that a man cannot grant an estate, and reserve part thereof, or make a feoffment in fee, and reserve a lease for life; also, that a man cannot reserve rent to his heirs without first reserving it to himself. Moreover, a reservation is often confounded with an exception: the distinction between them is said to be, that in a reservation some new hereditament is created, and that usually of an incorporeal kind; whereas in an exception a portion, as it were, of an already existing hereditament is merely withheld, or excepted, out of the conveyance. These distinctions and niceties are of less importance in American conveyancing than in English. A reservation is something taken from the whole thing covered by the general terms making the grant, and cuts down and lessens the grant from what it would be except for the reservation. Miller v. Lapham, 44 Vt. 416. How far the word reserving, in a deed of an ore-bed, imports a license to enter, &(;., see Stockbridge Iron Co. v. Hudson Iron Co., 107 Mass. 290. Reserving, in a deed, may operate to create an exception, instead of a technical reservation only, if such is the evident intent. Sloan V. Lawrence Furnace Co., 29 Ohio St. 568 3. In the United States public-land laws, a reservation, sometimes also called a reserve, is a considerable portion of the public domain segregated and withheld from sale for other public uses. Thus there are military reservations, being tracts of land required for military posts; Indian reservations, which the government has set apart for the dwelling of Indian tribes; and reservations for parks, mines, &c. 4. In the practice of the courts, to reserve a point is a mode of taking the parties to the expense of a formal writ of error or appeal. Should the judge before whom a cause is tried be of opinion that a point of law made, and upon which the case depends, deserves consideration by the full court, he may reserve it, as it is called. This may be done at nisi prius, with the consent of the parties; and, when done, an agreement is usually made that the court before which the point is argued shall be in the same situation as the judge was before whom it was originally raised, and shall have power to order a verdict or nonsuit to be entered, as they may think fit. By the judicature acts, this practice is so far extended that power is given to a judge to reserve points of law at his discretion for the consideration of a divisional court; but this is not to take away or prejudice the right of any party to have the issues for trial by jury submitted and left by the judge to the jury, with a complete and proper direction upon the law and the evidence applicable to such issues. Reserving a point may also be done by the judge in a criminal case; in which case the point is left for the judgment of the court for the consideration of crown cases reserved, composed of judges from the superior courts at Westminster. This has been a method for disposing of doubtful questions of criminal law, long and frequently employed; and the reports of decisions on these questions reserved form an important body of the criminal-law reports, known as Crown Cases Reserved. This proceeding of reserving a point accomplishes, by a little diflerent method, substantially the same result as is attained under the New York code of procedure, by the step of taking a verdict subject to the opinion of the court; or under the practice of the United States supreme court, by what is known as a case certified.