INSURANCE RISKS

Auckland Star, Volume LXXV, Issue 217, 13 September 1944, Page 8

INSURANCE RISKS

ON ACTIVE SERVICE INJUSTICES SEEN

The attention of the Dominion Executive Committee of the N.Z.R.S.A has been drawn to a matter that is causing serious losses to dependents of men killed while on active service, says a headquarters statement. As the law now stands, a person who insured his life since the outbreak of war ceases to be covered as soon as he goes overseas and for six months after, if death occurs as a direct result of his war service, unless an additional premium of £7 10/ is paid for each £100 of the sum assured.

This has also an important bearing on mortgage repayment insurances. In the case brought before the notice of the N.Z.R.S.A. a soldier was granted a loan by the State Advances Corporataion when a civilian in 1940, the corporation insisting, for its own protection, on the man taking up a mortgage repayment insurance policy. This policy carried with it the usual provision that certain war risks were not covered by the mortgage repayment insurance unless the additional premium previously referred to was paid. In this case the soldier left New Zealand approximately two years after the mortgage and the insurance were effected and apparently considered his home for his wife and children adequately protected by the arrangements lie and the corporation had made regardless of the fact that the insurance carried the memorandum of agreement absolving the insurance company from risk due to war service.

He was killed in action and his wife and family were justified in taking some comfort in the thought that his life insurance would protect his mortgage. Such hopes, however, proved to be false, as nobody except the State Advances Corporation and the insurance company concerned Appeared to know anything of the document which released the insurance company of its obligations to pay out to the corporation.

The N.Z.R.S.A. decided to give publicity to this matter in order that next-of-kin of policy-holders could be acquainted w'th the position so that they could take the action required to safeguard their interests before it was too late.