THE COLONIAL INSURANCE COMPANY.

New Zealand Herald, Volume XXVII, Issue 8422, 25 November 1890, Page 5

THE COLONIAL INSURANCE COMPANY.

[by TELEGRAPH, ess association.] Wellington, Monday, An extraordinary general meeting of /he shareholders in the Colonial Insure 0 ,'" p;l /,' y was held this afternoon, d confe»Jei the resolutions of the direc° rd ' commending the sale of tho <Jmpany's business to the Commercial U* on Insurance Company of London. Mr. J. B. Harcourt, chaiirr» in moving tho resolutions, paid that th^" re ctors were surprised at the circulur is<*cd to the shareholders some time ago made public, as it was of a confidon ,£ d nature. There had been some commer- and dissatisfaction expressed at some extensive purchases of the comply*® shares which had been marie in \Vollip?ton since tho negotiations for the sale $ the business had been commenced, and it had been insinuated that tho buyers M been favoured with information by tb»se connected with the company, who, 1/ giving such information, violated the t'»st reposed in them. Ho explained thaNbq Commercial Union Company for some phsb had had a business connection in N>w Zealand, and that the intended purchase of the Colonial Company's business came V their (Commercial Union's) agent in t h<* city in the ordinary way of business, and.ie, seeing a good investment, did not hostato to take advantage of the opportunity. Mr. ilarcourt said that since then tie directors had ascertained that the .ntended sale was also known in Auckland and Dunedin. While regretting that tho information had leaked out, the directors were confident none was supplied by the company. Ho briefly sketched tho career of the company since being established in IS7B. The company had met with fair success until 1882, when a change came over it. In that year the balance brought forward of £1234 had disappeared, and £7500, half of the reserve fund, had gone to pay losses, consequently there was no dividend in ISB3. They had secured a credit of £9158, out of which a dividend of 10 per cent, was paid; £2500 restored to the reserve fund, av;'l £1658 carried forward. The year IK,SI absorbed the £1058 brought forv 'ird. i» ,v?. ended with a deficit of £4057. In order \.o make both ends meet, £2000 was taken from the reserve fund. That year was disastrous to most of tho insurance com panics colonially-owned, as ho pointed out that out of eight only three paid a dividend out of underwriting. In 1886 tho balancesheet showed the whole of reserve fund to have disappeared, the losses for year on underwriting being £11,005, but bringing interest on deposits and mortgages to account tho nett loss was reduced to £8828. It was then suggested to sell tho business, but nothing came of the proposal. In 1887 tho loss on underwriting was reduced from £11,695 to £3285, and again bringing the interest to account the year was got over with a nett loss of £015. But with tho sum of £2793 brought forward the year ending Ist March, ISBB, was begun with a debit balance of £3409. This year tho company had heavy losses by fire in Sydney, Napier, and Wellington, and also on marine risks, but notwithstanding these tho per eentage of losses was reduced from 91.5 to 77 per cent. The year ended with a profit of £3547, but unfortunately all this was swallowed up by a law suit in Adelaide, and the year ended with £3984 on the wrong side. In 1889 the debt had disappeared, and a credit remained of £363, which was the first time for four years. At tho end of tho year, March, 1890, the credit balance had increased to £8113, which enabled tho directors to once more place thecompanyamongthedividendpaying institutions of the colony, Since tho company was established it had received in premiums, interest, etc., £565, ; and paid fire losses, £221,297; marine losses, £138,614 ; expenses of management, preliminary expenses, etc., £109,329; dividends, £24,478 (equal to £4 12s Od per cent, for the whole period). Referring to NewZealand Insurance Companies for the four years ending 1889, he said they had come out badly, as for that period the whole of the companies combined have lost 1 '52 per cent, of their premiums' income,' which for the time stated amounted to no less than £3,450,720. This unsatisfactory position must be attributed to the low rates caused by keen competition. In conclusion he eulogised the services of Mr. Frank Allan, general manager of the company. The proposals for the sale of the business were carried with only one dissentient.