THE MUTUAL LIFE AND CITIZENS' ASSURANCE COMPANY, LIMITED.

Auckland Star, Volume LXXI, Issue 102, 1 May 1940, Page 4

THE MUTUAL LIFE AND CITIZENS' ASSURANCE COMPANY, LIMITED.

ANNUAL MEETING HELD. RECORD OF NEW BUSINESS. The fifty-third annual meeting of the company was held in Sydney on April 18, 1940. The chairman, Sir John Peden, in' moving the adoption of the report and balance-sheet, said: — This is the first meeting since the death of Mr. James Ashton on August 0 last. I begin this morning with an expression of the deep sorrow with which we miss the spell of his presence. It would be difficult to pay an adequate tribute to his eminent service in public life and in private capacities. In his long and intimate association with the com] pan}', we were proud to claim him as a leader and a friend. A member of the board for twenty-five veers, and for the last twelve years our chairman, lie conserved and promoted the interests of policy-holders, staff and members of the company with outstanding ability and far-seeing wisdom. Dr. Arthur Mills, for many years our chief medical officer, died in harness on the 10th instant, his own cheery self to the last moment of his life. With profound regret the board has recorded its deep sense of the loss sustained by the company in the death of one whose knowledge, judgment and devotion to duty have been of inestimable value. It has offered sincere sympathy to Mrs. Mills and tlifc members of his family.

Mr. A. G. Copeland, a member of the stuff for uiore than 50 years, and general secretary since Mr. lJloomfield's death, retired "from that office last year. Fortunately we have been able to retain his services as a director. Mr. M. C. Alder, who has been with the company for 30 years, lias been appointed general secretary. During 1930. its fifty-third year, the company again made gratifying progress. Fur tlio fourth successive year the new business was a record. In comparison with the figures of 1938, the new business in the ordinary branch leached £8,388,171, as against £8,233,135, and in the industrial branch, £4,500,793, as against £4,440,654. With a record in each branch, the total amount of the new business for both wa* £12,954,904, as against £12,073,789. These results were obtained at a low rate of excuse under economical management. They were obtained, too, in a year of recurring crises, culminating in war, and during a period in which ihero was a general tendency for new business in life assurance to decrease. Total Assured £89,000,000. Tlie company has now more than OSS,OOO policies in force. With bonuses they assure £59.000.000. In estimating our actuarial liabilities we use the most stringent liases of valuation in Australia. Interest to be earned in future is assumed to be only 2J per cent in the ordinary branch, and only 2J per cent in the industrial branch. These assumptions allow for a wide margin of security in each branch. 111 ltl.'iO, the rates of interest which were realised after deduction of taxrs from the interest income were £4 10/10 per cent in the ordinary branch, and £4 12/2 per cent in the industrial branch.

Assurance funds increased during the year >v £1,023,009. They now stand at I £20,096,944. In addition, we hold general reserves amounting to £600,000, and taxation reserves of £279,300. As further security for policy-holders, there is the capital of £1,000,000. The total assets of the company amount to £30,173,335. Nearly 70 per cent consists of public securities or carry a Government guarantee. The aggregate book values of the assets are considerably below the actual market values. The total income for the year exceeded £4,500,000. More than £1,300,000 of the income represents interest on investments. The interest outstanding at | the end of the year amounted only to £7387. Of this sum we have brought into account only amounts paid during the first few weeks of the current year. During the year our holdings of (Jovernnient and municipal securities were substantially enlarged. Our advances to co-operative building societies, which operate under Government guarantee, increased by nearly £900,000 to | £2,098,414. Through these societies we have financed or arranged to finance the I erection or the purchase of about 3500 homes. This is more than a matter of investment. It is a form of social betterment with which we are glad to be associated. Nearly £2,000,000 In Claims. Claims paid during the year amounted to £1,942,941. Since its inception, the company has paid to policy-holders and their beneficiaries, £38,855,548. Our mortality experience continues to be highly satisfactory, and is evidence of the careful attention which is paid to the selection of risks. 111 the with-profit section of the industrial branch, the section which comprises the great bulk of our industrial branch business, and includes all policies issued in Australia and New Zealand since 1925, the policy-holders are entitled to at least 80 per cent of the profits. Substantial bonuses are allotted annually in this section. In tire other section of the industrial branch, which consists of non-participating policies, we have made substantial voluntary grants in the past, and have, in fact, paid approximately £200.000 in of our contractual obligations. Recently we have made further provision' for concessions to non-participating whole-life policy-holders in Australia and Xew Zealand. 1 Shortly after the war began we decided that in the case of policyholders serving in the Army or Navy, the company would waive any clause on existing policies by which the death risk was restricted while the assured was 011 active service. We have also decided that in policies issued before the war. the company will waive aviation restriction® in respect of life nssuranee benefits. where death is caused by any accident or injury while the assured is engaged on aviation duty in or in connection with war service. In accordance with universal practice, war conditions form part of all new policies, as the normal premiums do not provide for the extra hazards of war. True financial strength in a life office, and proper security for policyholders, can be maintained only by a careful husbanding of resources and by ample provision for exceptional strains. The M.L.C. has maintained its great strength throughout a long period. To-' day it is stronger than ever. We must, however, anticipate an increase in death, claims and in taxation, while the interest obtainable 011 investments will probably fall. In view of these eventualities, and in the interests of policy-holders, we have decided to add to our reserves Insetting aside £225.000 from the surplus of the ordinary branch and £04,500 from the surplus of the industrial

branch. At the same time it has been possible to allot substantial reversionary bonuses to policy-holders. Life assurance funds are an aggregation of savings of individual policyholders. The total amount of the funds held in Australia by life offices is nowwell in excess of £200,000,000. They fall but little short of the total savings bank deposits. These facts are significant not only of the value which is being placed upon life assurance bv all sections of the community, but also of the importance of the life offices in the financial structure of the nation. At the time of the Great War, the M.L.C. subscribed millions to war and peace loans, nnd gaVe a lead which was of great help to the Commonwealth. To the first loan in the present war we subscribed one-fiftieth of the total issue. We are helping in other directions. We shall continue to subscribe and to help throughout the war. New Wellington Building. Mr. F. Leverrier, K.C., in seconding the chairman's motion for,the adoption of the report, said: — We are keeping open the positions held by members of the office and field staffs who have enlisted or who have been called up for military duties. In the case of the office staff, we are paying the difference between the office and military pay in each «se, and arc making generous provision in similar circumstances for the men in the field. We shall follow the ianic procedure throughout the war. Work on the Wellingtcn, New Zealand, building steadily last year, anil save for some minor finishings, the structure is now complete. Tenants arc already in ooeiipaiu-v, and the company will conduct its New Zealand business from those headquarters from this mouth. The Wellington building is akin in design to those erected by the company at Sydney and Melbourne. It forms an outstanding addition to the architecture of the Dominion capital city. The handsome appearance and convenient internal arrangement are highly commended, and make it a credit to the company. A vote of thanks to the director*, trustees and staff was proposed by Mr. E. P. Hollingdal, and carried by acclamation. A vote of thanks to the chairman, proposed by Sir Henry Manning, ter- | minated the proceedings.