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Pronounced /tɒnˈtiːn/Help with pronunciation

The tontine is a system of annuities in which the benefits pass to the surviving subscribers until only one is left. It’s named after Lorenzo Tonti, a Neapolitan banker who started such a scheme in France in 1653, though it has been said that they were known in Italy earlier.

Each subscriber paid a sum into the fund, and in return received dividends from the capital invested; as each person died his share was divided among all the others until only one was left, reaping all the benefits. In the original scheme, the capital reverted to the state when the last subscriber died, so it was really a kind of national lottery. The idea was taken up enthusiastically in France and later in Britain and the USA; it was used to fund buildings and other public works. (There are still several hotels and other buildings in Britain and the USA with the word in their names.) Later there were private schemes in which the last survivor got the capital as well.

Tontines were eventually banned in Britain and the USA, because there was too much incentive for subscribers to bump each other off to increase their share of the fund, or to become the last survivor and so claim the capital. For that reason, it has been a wonderful plot device for detective story writers, who can use it as a motive for serial murder; it was the theme of The Wrong Box by Robert Louis Stevenson and his stepson Lloyd Osbourne in 1889 (made into a film in 1966). The concept survives in a limited way in France.

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Page created 07 Nov 1998