Govt Life’s funds rise

Press, 20 December 1985, Page 10

Govt Life’s funds rise

PA Wellington Government Life Insurance Corporation’s policyholder funds rose 68.7 per cent to 3135.5 M ($80.3M) in the year ended September 30. The chairman, Mr B. S. Cole, said the unaudited results for 1984-85 were excellent desp te an over all reduction in life insurance industry sales because of tax changes. Premium income increased 57.4 per cent to J114.4M ($72 7M) and net investment income was up 46.1 per cent to policyholders were $70.4M ($53.6M) and operating expenses $24.7M ($21.9M). Tax took $29.7M (?13.9M). j Extraordinary unrealised gains from market-linked funds added $3.5M (nil) and transfers from reserves were $3.6M (S2.OM).

The market value of assets under management was IIIBOM. . _ iif(a New annual premiumi Uie business increased to $B.bM Using the industry standard of counting only 10 per cent of single-premium business with 100 per cent of annual premium busines to measure overall growth, the corporation’s life business increased 39 percent . ~ frlr Cole said the variable investment and protection policy produced an after-tax return of 27 per cent to policyholders in the year. The corooration’s superannuation business exceeded all targets, including contribution income from schemes administered by the corporation which rose more than 50 per cent (excluding transfers). Mr Cole said the equity linked superannuation fund launched on April 1 had already produced a return of more than 24 per cent in its first six months. Despite growth in all areas of life, superannuation and investment business, there had not been a proportionate increase in management expenses — the ratio of expenses to income had dropped from 13 per cent to 9.5 per cent The change in taxation legislation had substantially increased the corporations tax liabilities by 113 per cent. Mr Cole said that although the year had been a good one. it could have been better if the corporation was free to determine the nature of businesses it operated and was unconstrained by public service procedures and precedents. _He forecast another year of “continued growth and success.”