Soldiers’ Life Insurance

Press, Volume LXXV, Issue 22823, 23 September 1939, Page 12

Soldiers’ Life Insurance

The. suggestion made by Mr W. A. Bodkin, M.P., in a question to the Minister for Internal Affairs (the Hon. W. E. Parry) that the Government should consider paying the increases in soldiers’ life insurance premiums from patriotic funds opens up wider questions than Mr Bodkin possibly had in mind. The majority of insurance offices have already agreed that premiums on . existing pbVtefes nnt be itwseasedv but it is understood that policies taken- out now by soldiers will carry an additional war risk premium to ( cover the full amount of the. policy in the event of the soldier leaving New Zealand on active service. Alternatively, if the soldier elects to pay the present premium rate only, his dependants will be entitled to-collect only the amount of premiums paid,.plus;interest, in the event of his being killed or dying on service -overseas. Men enlisting will naturally desire to insure their'lives for the benefit of their dependants, but oh the average soldier’s pay it would; he practically impossible to insure for anything like an adequate amount and certainly impossible for, most. men, unless they enjoy* a private income in addition to their military pay, to find the premium as increased by -war risk. Further,, there is the case, of a considerable .lumber of men of military age who have already provided for the future of their dependai. ,3 by heavy investment in, life ihsur-

ance policies and who might well hesitate to offer their services in a military capacity if they felt that by doing so they would have to sacrifice the welfare of their dependants. Most men who are carrying a considerable load in life insurance premiums would be earning in civil life considerably more than they would receive in the army. This might make it impossible for them to keep up payments from theii reduced income. The man in the ranks, unless he has an independent income, would be almost certain to have to reduce his cover in any event, if he were not given some assistance. In the last war many soldiers found it difficult to maintain payment of premiums out of their small allotments, especially when the war increase was added. Many policies no doubt had to lapse for that reason, 'or payment entailed considerable sacrifice on the part of the soldier or of his dependants. It seems unfair that this risk of financial loss should be added to the other risks which the soldier may have to face. At the same time the introduction of a scheme for the payment of increased premiums could scarcely be considered without reference to the feasibility of providing for the payment of all premiums while a soldier is on active service. This, again, could not be considered without reference to the Government’s plans for providing for the dependants of soldiers who may be killed or die on active service. Should the Government decide that the principle of helping soldiers either with the payment of increased premiums or premiums generally should be established, its problem is by no means solved. Obviously some limit would require to be set on the amount for which a soldier could be insured under the scheme. A plan would need to be evolved for meeting the special circumstances and responsibilities of the individual. (It would be necessary, for example, to have some assurance that the soldier was capable on his return to civil life of carrying on the payments to which the Government might be committed or partially committed during his military life.) Such a scheme, whether limited to the extent of Mr Bodkin’s suggestion or more widely embracing, does not appear to present insoluble problems, but it would have to be carefully thought out and actuarially sound. If anything of the kind were in contemplation the Government would no doubt seek the advice and co-operation of expert life insurance men in drafting it. The wider problem of provision for dependants of soldiers will necessarily have to be considered apart from as well as with any insurance scheme, which would necessarily be a voluntary arrangement. Financial provision for this purpose will require early consideration by the Government.