STATE FIRE INSURANCE

Evening Star, Issue 20254, 15 August 1929, Page 6

STATE FIRE INSURANCE

MINISTER ON UNFAIR ATTACK TRADING METHODS DEFENDED [From Ouu Correspondent.] WELLINGTON, August Id. In ihe course of an interview to-day the Hon. Sir Apirana Ngata, Minister in Charge of tho State Fire Insurance Office, dealt with certain remarks ami allegations emanating from Wellington, and recently published in several leading newspapers, regarding the State Fire Office. One ■ statement made was that the Prime! Minister (the Right lion. Sir' Joseph Ward) docs not appear to sympathise with any further growth of the office at tho expense of the companies, in reply to this. Sir Apirana. Ngatu said that tire- Frime Minister bad authorised him to say that ho had made no such statement.

Other allegations dealt with by tho Minister were that tho development of tho State Fire Office bonus rebate was a mistaken way of conducting business; that tho State Office operates with unfair advantages, such as obtaining the cream of the State Advances and Public Trust business, enabling it to quote unduly low rates; that the figures which show tho year’s operations by tho State Office are not correctly compiled, and that if proper allowances were made it would be found that-ilie office was not making anything like the profits that it shows.

I The Minister explained that bonuses out of profits io persons insured with Lite office were provided for iu I lie , original- State Fire Act of 1003. The mutual principle of the legislation remains in operation to-day as a. popular feature of the Act. Since 1023 policy-holders of the office have benefited by rebates to ibo extent of •£127.000. and the general public lias also substantially benefited by similar rebates given by the private insurance companies . Sir Apirnna also said Dial; it was a usual practice for mortgagees to require mortgagors to insure with such insurance offices as they nominate, and this practice, winch is considered legitimate, precludes the State Office from obtaining much butness that would otherwise come to it. However, neither the mortgagors of the Sl at© Advances Office nor of the Public Trust Office arc compelled to insure with the State Office. Only in the case of State Advances mortgagors is a preference expressed, wiibout, however, any compulsion. The allegation in vegan! to the annual figures, the Minister said, is as unscrupulous as it is without.*foundation, and is effectively answered by the fact that the State Office annual accounts arc drawn up on commercial lines as laid down by Act, and are certified as correct by the Controller and Auditor-General. The Minister further stated that ho was .satisfied that the altitude of the State Office was not such as to drive well managed offices out of business. The department pays all expenses out of revenue, and in future land as well as income tax, and its strong financial 'position, built up mi a borrowed capital of £2,000, long since repaid with interest, and its ability to grant bonus rebates, may bo fairly ascribed to its record of excellent service to the public,- coupled with careful underwriting and low working costs.'

Sir Api ran a said that, be was pleased to note that the executive of the Fire Underwriters’ Association dissociated itself from what, must bo characterised as an Unfair attack on this useful and Ilopular department.