THE COLONIAL INSURANCE COMPANY.

Press, Volume XXXI, Issue 4290, 30 April 1879, Page 2

THE COLONIAL INSURANCE COMPANY.

[Condensed from the " New Zealand Times," April 2ot_.J The first general meeting at the shareholders of this company was held yesterday afternoon at the Athen_Sn7 The Hon. 6. J- Pharazyn. chairman of the Board ot Directors, occupied the chair, and there was*£ood.attendaace......... „ ~.. the usual preffi&umea the general manacer Mr George S. Graham, reid the following re.Jiort ™ The directors have much pleasure in snbmtttibg to the shareholders their first report and balance sheet. The company was registered upon tbe-Tth April, IS7B, but their principal branches in the colony were not fairly established until the following months of June and July, hence the first financial period represents the resnlt of about nine months' business. The income from premiums has been £32,988 19s 6d; interest upon investments, £1365 6s Id; transfer fees, &-., £26 4s 9d. The losses for the time have been heavy, including £140418s 9d. incurred, but not paid befvre the Stat March, 1879, they amount te £9036 6s lid. After deducting re-insurances, £5859 3s; losses, £9036 6s lid ; commission and general expenses, £8282 6s lOd, the amount to credit is £11,07- 13s 7d, from which it has been decided to deduct the whole of the preliminary expenses incurred in the formation of the company, £321* 13s 9d, and books and stationery, £1138 5s 6d, which still leaves a balance to the credit of profit and loss acconnt of £6719 Ms 4d. With the view of creating a reserve fund, and to add to the confidence insurers have already reposed in the compsny, the directors recommend that the balance be carried forward to profit and loss, new account. Mr X W. Nathan tendered his resignation as director, having to leave the colony and permanently reside in London. The directors accepted same, and have appointed Mr J. S. M. Thompson, of the firm of Messrs Thompson, Shannon and Co., in his place. Branches have been established throughout New Zealand and the Australian colonies, as also in London, Calcutta, and Tasmania. The business of the company is steadily increasing; every care has been taken as to the 6electiom of its representatives, and to its being conducted on economical and sound insurance principles. As intimated when the company was formed, capital to the extent of 10s per share would be required, shareholders have already been called upon for 7s 6d of this amount, and it is intended at an early date to call up the remaining 2s 6d. The following is the business to be transacted at the meeting:—To receive and adopt balance-sheet and directors' reports j to elect an auditor or auditors for the ensuing year, and to determine the amount of his or their remuneration; to fix the date. f future general meetings." PEOFIT AKD LOSS ACCOUNT. Dr. £ s. d. £ s. d. To fire and marine re-in-surances — ... 5,889 3 0 Fire and marine losses paid 7,631 8 2 Appropriation for lossesUnpaid and unadjusted 1,40t 18 9 9,036 611 Preliminary expenses ... 3,21 il3 9 Stationery, boote, and forms ... 1,138 5 6 Commission, salaries, and other expenses ... ... -. 8,282 610 Balance ... 6,71914 4 £34,280.0 4 Cr. £ s. d. By fire and marine premiums ... ... 32,968 19 6 Interest on investments ... ... 1,265 6 1 Transfer fees, inspection of share register fees, articles of association sold, and interest on calls in . . arrears 26 4 9 *34£S0 10 4 B--AXC_-S-__-. Dr. Liabilities. £ s. d. Capital—loo,ooo shares, at 7s 6d per share called up ... 37,500 0 0 Appropriation for unpaid losseß ... 1,404 18 9 Sundry creditors... ... 264 16. 8 Profitandlosa ' ... 6,719 14 4 £45,889 9 9 Cr. Assets. £ s. d. Investments 33,320 0 0 Calls in arrear ... ... 2,428 2 6 Cash in bank at head oflice and at branches and agencies... 2,299 14 4 Cash in hand, and amounts owing at head offico and at branches and agencies ... ... 6,225 2 0 Bills receivable ... ... 350 0 7 Office furniture and fittings 824 11 9 Stationery, books, and forms on hanl 282 2. 7 Government license paid in advance... 150 0 0

£45,889 9 9 We have examined the accounts and hooks ot the company, and find that they are kept in accordance with the Articles of Association, and that the balance-sheet exhibits a true summary of the transactions of the company for the financial period ended 31st -larch, 1879, and of the liabilities and assets at that date. We have also examined the securities, and find that they represent the amounts shown in the books. Cms. P. POWUSS, 1 Auditor,, G. M. K_B____, $ Ana »- n "»- 21st April, 1879. The Chairman said—Before moving the adoption of the report I should like to mako a few remarks. Certainly we ought to congratulate ourselves, though at this late period of New Zealand insurance history, that a company has been established whose head-quarters are; in Wellington. All the other provinces had advanced ahead of us in this respect. Auckland some years ago started the New Zealand Company, succeeded a few years _»*j- , .i'»" V" OOLrtll British.Dunedin, *•">_ «sftaDlis_ed its two companies sna Christehureh one; so that, with the exception of Nelson, Wellington waa the only chief city which had not a company. We certainly had somewhat lagged behind the times in this respect, and itis a rather curious circumstance that even in starting this company we have been indebted to a gentleman who resided outside of the Wellington province—a gentleman who was indeed the promoter of the company. The directors have had to encounter very considerable difficulty, for inasmuch as the market was already pretty well supplied with insurance companies, it was a bold stroke w< made in eadeavouring to rescue the Empire City, as it is called, certainly the seat of Government, from the disgrace of being the head quarters of no insurance company. However, we have accomplished that, and we now look to the shareholders and the general public to assist us so as to lead np to perfect success. [Hear, hear.] There is one thing I might call your attention to. It seemed at one time as if we should be landed in a sea of trouble owing to the compet tion among the offices, and the style of business that was resorted to, but I am happy to state that owing to the exertions of onr manager that style of business is not likely to be carried on iv future; that is to say, we have arrived at the conclusion that there is room enough for all of us, and we are not going on cutting one another's throats, j] Hear, hear. 1 In starting we _ were very fortunate in securing the services as manager of a gentleman of long experience in the colony, and a thorough expert in insurance matters. He has | proved himself a first rate captain at the helm, and I he has moreover been assisted by a gentleman whose exertions have been beyond anything which could have been expected. Their efforts have been well supported by all the officers aud agents of the company, and as most of our employes are also large shareholders we have the best guarantee that they will be careful in their acceptance of risks. The balance sheet, which has been read over, will Ithink be satisfactory to the shareholders, but its favorable features will be more readily observed on reference to the first balance sheets of some other companies. The South British Company during the hrst six months of its existence received £14,000 in premiums; in nine months we have received £3_,900. The South British losses were £2992 for six months, and £7534 was carried to the credit of profit and loss; while in nine months we have lost £9038, a vast difference, and yet have carried £6719 to credit of profit and loss account. The National's premium* for the first six months were £26,629, against onr £53,958 for nine months; and its losses were so trifling, £951 only, that it was able to carry £17,000 to credit after six months' operations. The Standard, however, only had £23,000 premiums for twelve months against onr £32,000 for nine months, and carried forward £9900 for twelve months, against our £6700 for nine months. The Union Company during the first »ine months received £42,000 in premiums, and carried forward £14,000. These figures show that we have had a very large measure of success. [Hear, hear.] And further, that colonial companies get the preference with insurers. These premiums must come out of someone's pockets, and I think the foreign companies suffer. It cannot be denied tbat our losses have been large, but if we look at the con. stant records in the newspapers of fires, many of which unfortunately may be -raced toincendiarism, perhaps the resnlt of bad times, we have an explanation of the losses. No doubt it is a very bad feature in our commercial life, and I am glad to say the insurance companies are taking resolute action to check the continuance of such a state of things as much as possible. There is one thing, the public must have every confidence in us, looking at our capital and at tbe fact that we have, without further calls, ample funds to meet all possible losses, for I may say we limit our risks in every block of brick buildings to an amount not exceeding £4000—[Hear, hear] —and confine our marine r'sks to that amount on each vessel. [Hear, hear.] I can only say further that the directors look forward with great confidence to future.' prosperity, for we have been favorably received in every port of the colony and even out of the colony. Indeed, I have no doubt that this time next year, instead of informing you we have made so much which we propose to carry to a reserve fnnd, we shall be able to meet you with the declaration of a substantial dividend. I move the adoption of the report. [Applause.] _ The Hon - Dr - Gra ce-Sir, I should like further to explain the view which I, as one of the directors, take with regard to the actual profits which the company has succeeded in securing. Yon see, sir, the actual profit of the company at this moment maybe described as being theHquidation of the indebtedness which arose from the establishment of the company—that is to say £321. 13s 9d plus the beneficial interest which the company ■till has in the stationery, £1138 5s fid. But in addition to that it must he remembered the balance we have carried to the credit of profit and lose, and propose to place in the reserve fund {£6719 14s 4d) w©nH to-morrow, if we so desired, more than re-insure the whole of our outstanding risks. Therefore, sir, our position is this—We have, in an extremely difficult time, and in the face of competition. Intense competition, succeeded in establishing on a solid basis a business of this kind. We have succeeded in extending ite ramifications throughout the colony; in establishing eflicient business relations also in London and Calcutta. Tour bust-ess has been solidly established, a goodwill and valuable connection created; and you may further feel sure that to-morrow, if it seemed politic to wind up or sell out, we should have a reserve of more thnn sufficient to cover the whole of cur outstanding risks. However, with relations towards all our agents of the most cordial character, having had no hitch np to the present time, and seeing that we have in onr employ the highest technical knowledge to be found in this colony, w_ may safely conclude we have attained a thoroughly permanent position. [Hear, hear.] Sir, one cannot dwell too much on the value of special knowledge in the matter of this kind. The wbola fata of «n insurance busmess really depends upon the capacity of its officers accurately to estimate the character of risks. [Hear, hear.] The premiums s«* forth in this statement of account «Sf™«!t?^^ c been ambled, but it has not been SJ-Sw'i 01 to run into risks indiscriminately. [Hear, hear.] It has been the poScy

of the directors to establish, a business upon a sure i basis, to take the largest .amber oi small risks, and i t* distribute these as widely as possible—in fact, to proceed npon the best ascertained mathematical ! principles and the most confirmed experience, in good faith that the result would work out satisfactorily. [Hear, hear.] And so far it has been satisfactory. Insurance men agree that it has been satisfactory. I hold in my hand a telegram from oned the foremost insurance men in the southern hemisphere, and this is whit he says in effect :— " Sincerely congratulate you on your great success. How on ear—a did you ever establish the business so well ?" [Cries — " Name."] I have no authority to give the _ai-e ; iThe Chairman — Yes, give the name.] No; any shareholder may see the telegram, but it is a private one; and with all due deference to the superior sagacity of onr chairman Ido not choose to give the name publicly. Sir, I think we ha ye raised np an institution of whichwe have a right to be proud, for experienced men look upon the company as an absolute, and solidsuccess—[hear, hear]—and the more fairly can we congratulate ourselves on the resnlt when it has been achieved in the face of intense competition, and in spite of the low rates which have been prevailing ; at any rate, no shareholder has any right to look at the matter merely as an ordinary debtor and creditor aoconnt, and run away with the idea that the company has not been a complete and thorough success. [Hear, hear.] There is this to be said in regard to the point raised by Mr Wallace. We had to expend large sums of money in establishing agencies in every part of the colony, and it may be that the business is small in comparison; but it is constantly increasing, and for the some expenditure we shall be able to do two or three times the present amount of business, and you will find that our nest annual statement will thoroughly bear out my remarks ou the subject. In answer to questions put by Mr Woodward, The Chairman said that by the Articles of Association the present directors held office till next annual meeting, when a third of them retired, aud there were retirements every succeeding year. The eonij any's investments were in freehold land and debentures. The directors proposed to call up "is 6d per share as stated in the report. Mr Woodward confessed himself unable to see the necessity for the calL The directors had £12,000 in their hands, and according to the chairman they could with the capital called up meet every conceivable claim. Then why did they wish to'call up more capital. '***~ 7. The Chairman—lt is clear that the larger the capital the more business we can undertake. But irrespective of that, the directors are only acting in accordance with the conditions on which the company was floated, and is doing business with the public. If we failed to call up this 2s 6d per share, we should be committing a breach of faith. Mr Woodward—With whom? ' The Chairman—With the public. »o doubt the time U inopportune, but we have already postponed the call on acconnt of the times. The Hon. I>r. Grace took the same view ia the chairman, and said it was more especially desirable to keep np to the conditions, on account of the company's relations with business men eutside the colony. In answer to Mr Didsbury, The Chairman said interest was charged on calls in arrear. , The motion for the adoption of the report was then put and carried unanimously. AUDITORS. Messrs. C. P. Powles and G. M. Kebball were appointed auditors, and their honorarium fixed at twenty guineas each per annum. ANNUAL MEETING. It was resolved that thehooks and accounts of the company should close on the 31st March in each year, the annual meeting to be held' not later than the 31st May following. The Chairman explained that it took a considerable time to make up the accounts, but the directors would always call the annual meeting for as early a date as possible. LIMITATION OF M-BCLITY. , The Chairman suggested, as a point worthy of consideration at the hands of the shareholders, that insurance companies should take joist action to limit the liability ot insurance companies to the amount of their nominal capital. Unlimited liability frightened people after the recent sad i furores in Great Britain, and he observed that in the t.-ilish Parliament the subject was being de- , bated just now. Mr Wallace thought the suggestion was well worthy of consideration. The "matter then dropped. ) VOTES OF THANES. i Mr Woodward moved a vote of thanks to the i directors, and Mr Madely seconded. Carried. _ l The Hon. Eandall Johnston, in acknowledging the compliment, said the directors one and all had | worked very heartily, for the success of the comg any, and would continne to do so. He wished to c allowed to move a Tote of thanks iv favor of the ; officers of the company, who had rendered the directors invaluable aid in fighting against coml petition; he might almost say opposition. The • officers had taken the utmost core, and if the company had not appeared in the lists of losers eon- ) tin-ally being published of late so often as other j companies, that was not from want of opportunity i to issue policies, but from care in taking risks. The r company had absolutely declined many risks on i which other companies had subsequently loßt. Mr Johnston paid a high tiibnte to the ability, zeal, l and discretion shown by Mr G. 8. Graham, and said i that gentleman had had a most able coadjutor in ; Mr Frank Allen, who had thoroughly organised the j head oflice. [Applause.. Carried unanimously. Mr Graham thanked Mr Johnston for the flattering manner in which he had spoken of his {Mr J Graham's services, and the shareholders for the , kind vote they had oarried. It was always gratifying to have one's services recognised, but more especially when it took place in the presence of shareholders from North and South, some of whom present had known him in the underwriting business for a quarter of a century. [Hear, hoar 7] He thanked officers under him for the assistance they had rendered, and on their behalf generally re- , turned thanks, more especially to Mr Allen, who he I would leave to reply for himself. Mr Allen briefly a knowledsred the vote. The proceedings then terminated. <