Information AboutTontine |
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A tontine is an investment vehicle which combines features of a group Annuity , group Life Insurance , and a Lottery . The scheme is named after Neapolitan banker Lorenzo De Tonti , who is generally credited with inventing it in France in 1653 . Some sources claim that similar schemes already existed in Italy, but there is no dispute that the popularity of the form was due to Tonti. The basic concept is simple. Each investor pays a sum into the tontine. The funds are invested and each investor receives projects, which often contained the word "tontine" in their name. In a later variation, the capital would devolve upon the last survivor, effectively dissolving the trust, and it is this version that has often been the plot device for mysteries and detective stories. While once very popular in France, Britain , and the United States , tontines have been banned in Britain and the United States due to the incentive for investors to kill one another, thereby increasing their shares. Nevertheless, there are underground organizations in the US that still use the tontine, and ownership of a business or property by Joint Tenancy With Right Of Survivorship has much the same effect.
A tontine is also used as a plot device in the novel ''Seventy Seven Clocks'' by Christopher Fowler , and in one of the '' Dr Syn '' books. P.G. Wodehouse used a similar idea in his novel ''Something Fishy'' (''The Butler Did It'' in the US.) In Wodehouse's version, the money did not go to the last survivor, but to the last son of the investors who remained unmarried. |
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