DOMINION’S ABNORMAL FIRE WASTE

Dominion, Volume 22, Issue 267, 7 August 1929, Page 13

DOMINION’S ABNORMAL FIRE WASTE

“CAUSE FOR SOME CONCERN” COMMENT BY COMPANY CHAIRMAN Dominion Special Service. Auckland, August 6. The seventieth annual meeting of shareholders in New Zealand insurance Company was held to-day. Air. v. Rhodes, chairman of directors, presiueu. The annual report and balunce-sii was .submitted. In moving the adopt. • of the report, the chairman said: J.ne year under review has again presented its difficulties, and the claim cost has ruled high. The marine market of the United Kingdom—the present-day bugbear ot most companies—has continued to exercise your directorate and executive, and while some advance in hull rates has been brought about, efforts on the part ot tile associated companies to improve cargo rates have not developed along liealtny lin££. The rates ruling in London aie still inadequate, and the conditions are unsatisfactory, and for these reasons our operations there follow a strongly iestricted- policy. Notwithstanding increasing competition at most points, the income has advanced from £lJo(J,4d- to £1,183,973, giving a satisfactory increase of £33,741. The underwriting profit, however, after making full provision tor all contingencies, is rather less, being £BO 209, or 8.21 per cent., as against B.*--per cent, last year. The expense cost showed a slight decrease from 31.4 per cent. Inst year to 30.6 per cent for the period just ended. Business in New Zealand in both the fire and accident departments still gives insurance companies general cause for some concern. ine abnormal fire waste of the past two or three years continues without abatement, and tlie average claims cost of underwriters in New Zealand for the last statistical year is over 72 per cent.; add to this their average expense of 38 per cent., and it is clear that much business is done at a loss. Fortunately, with the experience of our company in other fields, we are able to show an aggregate of 61.2 per cent., and expenses 30.6 per cent., which yields a moderate margin of nrofit of 5.2 per cent. Without being extravagant this gives us some reason for congratulation under existing conditions. Consistent with the growth in the volume of assets, interest and rents derived from investments ; have advanced £3805 to n total of £134.077. being a return of 5.33 per eent. against 5.28 per cent, last year. The aggregate book figures of investments of your company standing at £2,515,739 are less than the market value of same. This year marks the 70th anniversary of Hie existence of the ‘New Zealand,” its incorporation dating from 1859. In 1909, being the occasion of our jubilee, our paid-up capital, reserves and carry forward stood at £755.000; in 1919 they had grown to £1,614,616, and to-day, ten years later, they stand at £2,486.000. Interest and rents in 1909 produced £28.648 against the present-day figure of £134,077. The progress of your company not only benefits shareholders, who number some 1900 in nil walks'of life, but constitutes a decided asset of the Dominion, whose name it has made favourably known in every continent.” Referring to the dividend the chairman said: “After full consideration of current conditions and in accordance with the conservative policy which has consolidated your company’s position during an experience of 70 years, your directors have decided to recommend to this meeting that the dividend this year should not bo increased but maintained at lid. per share for the half-year, making Is. lOd. per share for the year. The trust department is becoming a valuable adjunct to the main business of the company. Steady growth is being experienced and the support of shareholders and the public generally gives assurance of continued success and expansion. The day of the personal executor or trustee has passed and security and continuity of administration provided by a department such as ours is steadily being availed of by those seeking reliable executors or trustees.”

The report was adopted without discussion. The retiring directors. Messrs. Alfred S. Bankart, C. V. Houghton and Oliver Nicholson, were re-elected unopposed. Messrs. Henry Gilfillnn and F. C. Buddle wore re-elected auditors. Mr. P. A. Edmiston, in moving n vote of thanks to the directors and staff, said he was not going to pretend that he considered the result of the year's underwriting satisfactory,, as he thought it was poor, whether from force of existing circumstances or from unwise underwriting or other causes. Shareholders would probably only be able to decide when they saw the results of similar institutions. However, the fact that during the year nearly £1,200.000 in premiums had 'been paid showed that the directors and staff were entitled to appreciation. He therefore had much pleasure in moving on behalf of shareholders that thanks be recorded to the board of directors, officers, staff and agents throughout the service. This was agreed to unanimously.