LOSS ON INSURANCE

Evening Post, Volume CXXVI, Issue 74, 24 September 1938, Page 19

LOSS ON INSURANCE

P.M.I COMPANY

VOLUNTARY LIQUIDATION

OUTCOME OF MEETING

(By Telegraph—Press Association.)

AUCKLAND, September 23

A decision to go into voluntary liquidation was made at an extraordinary general meeting of members of the Public Mutual Insurance Company of New Zealand and, in accordance with notice of motion, Mr. J. W. Hyland, public accountant, Auckland, who previously had been appointed receiver on behalf of debenture-holders, was appointed liquidator. Information was given that for the 14 months ended August 31 last, the loss was £34,614. Dr. A. T. Begg presided. In a statement of the affairs of the company, Dr. Begg gave a summary of the financial position, dealing particularly with the 14 months ended on August 31." In the underwriting account, commissions and other expenses were shown at £23,496, and fire, marine, and accident loss at £52,001. The income from premiums was £39,302. The difference between reserve for unexpired premiums was £2410 and the underwriting loss was £33,786. The profit and loss account showed a net loss of £34,614. The balancesheet showed liabilities of £59,808, represented by debentures £23,700, sundry creditors £25,608, and reserve for unexpired risks £10,500. On the assets side was cash in hand £91, cash on deposit £10,000, motor-cars £1670, •furniture £937, agency balances and sundry debtors .£6566, and a net item on the establishment account, including the 14 months' loss previously mentioned, of £40,543. MANY HEAVY CLAIMS. Dr. Begg expressed the opinion that the' figures quoted made it obvious that the company's position was due to very heavy claims experienced during the period under review. Losses under third party motor vehicle insurance had been very heavy and operations in this business actually ceased on April 8, 1938. The fire business had also been unsatisfactory for the period. A decision had been made to dispose of the South Island business, which showed a loss of about £1500 a year. It was now realised it would have been wiser not to have entered into the third party business and to have utilised the original debenture issue in the establishment of other business. For this reason it was decided to make a new debenture issue of £30,000 at 6i per cent., instead of the original £12,000 at 8 per cent. A total of £9800 \ of the previous issue was converted j to the recent issue and underwriting arrangements were secured for the balance of the £30,000 debenture issue decided upon. The directors then felt the company was placed in a satis-j factory position. Unfortunately, however, the aggregate of claims over the past few months had been very heavy and these placed the company in a position where the directors did not consider it wise to carry on. Mr. Hyland had agreed to act in the dual capacity of receiver for debenture-hold-ers and liquidator for a maximum fee of £2000. ■■•■ After the question of appointing two directors was discussedv the meeting appointed Mr/'Hyland as liquidator and agreed that the company should go into liquidation, the deci- | sions being unanimous.