LOSS BY EARTHQUAKE.

New Zealand Herald, Volume LXVIII, Issue 20819, 11 March 1931, Page 13

LOSS BY EARTHQUAKE.

COMPULSORY INSURANCE.

AN ARCHITECT'S SCHEME. CREATION OF LARGE FUND. A schemo to provide permanent cover against future earthquake losses by compulsory insurance on (he lines of that enforced upon motorists to meet third-party risks has been formulated by Mr. K. W. Aimer, architect, of Auckland. Mr. Aimer classifies the losses arising out of an earthquake under three heads:—(l) The cost of personal relief, which should be borne by private subscriptions and by the whole community through the Consolidated Fund; (2) damage to private property and commercial and trading losses; (3) damage to public works and services, which must be borne by the Government and local authorities. It is with the second of these classes that his scheme deals. Damage to private property, he considers, should be borne by the property-holders of the Dominion through the medium of universal insurance.

Accumulating a Reserve. "Suppose that 20 years ago a system of compulsory earthquake insurance by all property-holders in New Zealand had come into operation at an average annual rate of 2s per £IOO of insurance," said Mr. Aimer. "This would represent an annual premium of l-10th of 1 per cent, of the value of all insurable property. In an earthquake-free period of 20 years premiums amounting to 2 per cent, of the total value of insurable property would have been paid.

"The value of fire insurance cover on property throughout New Zealand is rather more than £400,000,000 and allowing for property not usually covered the total value of insurable property may be taken at £500,000,000. Two per cent, on this figure means that £10,000,000 would be paid in earthquake insurance premiums in a period of 20 years. In ordinary fire insurance about 30 per cent, of premiums paid is absorbed in cost of collection, commissions, etc., leaving about 70 per cent, available to meet claims, so that £7,000,000 may be assumed to be the amount available in 20 years to meet the costs of a disaster such as the recent earthquake at Hawke's Bay. Administration of Scheme. "The fund should be controlled and administered by the insurance companies, who would be required by the Government to establish sufficient securities or reserves of an approved character to ensure their financial ability to meet claims that might arise. On the other hand, the insurance companies' total liability would be limited in a certain defined relation to the amount of fund which had accumulated. Perhaps the simplest and most direct way to ensure that earthquake insurance becomes universal would be legislation to enforce the inclusion of earthquake insurance in conjunction witn all fire insurance risks. "The rates of premiums could, of course, be varied in accordance with the type of property insured and in accordance with the situation of the district in relation to the known earthquake fault lines. A careful adjustment of the rates of earthquake insurance under expert guidance would have the effect of compelling the owners of certain types of building to strengthen them, rather than pay a penal rate of insurance. Thus earthquake insurance would more surely and with less friction achieve that improvement in the construction of buildings which it is hoped will be the outcome of the regulations which a commission is now attempting to frame. ~, Mr Aimer added that possibly ways and means might be found to provide in the scheme for recouping pait at least of the antecedent loss suffered by property - holders in Hawke's Bay. damage to river works. GRANT OF £SOOO TO BOARD. NO INTEREST FOR TWO YEARS. [BY TELEGRAPH.— PRESS ASSOCIATION. ] WELLINGTON. Tuesday. The request was made yesterday by a deputation from the Hawke's Bayßmr Board which waited on the Pume Minis ter, the Ft. Hon. G. W. Forbes, that £IO,OOO be granted by the Gove '" me for repairing the damage caused by the earthquake to river protection woiks in the board's area. After consultation with his colleagues, Mr Forbes announced that the Government had decided to make a grant of £SOOO on a pound for pound basis, board to be lent the £SOOO free of interest for two years.

CLAIMS FOR PAYMENT.

problems of committee. POOR RESPONSE TO APPEAL. The Napier Relief Committee has received a. very large number of claims for petty damage to property and for pavment for small items used in the removal and handling of the injured during the earthquake. It has also met with a very poor response to its advertisements calling for donations from people who can afford to pay and who received free food during the emergency period. A pleasing contrast to this is a letter, later followed by a cheque for £5, which was received from a lady school teacher who stated that she wished to make some payment for benefits received as well as to make a donation to the relief funds.

despicable crime.

CLOTHES STOLEN AT" NAPIER.

YOUNG MAN SENT TO PRISON. [BY TELEGRAPH.—PRESS ASSOCIATION.] NAPIER. Tuesday. " Speaking as a father, and not as a magistrate, I want to tell you that I consider this type of crime so despicable that, had I discovered it I should have liked to have had the power to order the perpetrator to be shot, and I would have been up at dawn to see the sentence carried out, said Mr. A. Mow - lem, S.M., in addressing Cyril Dixon, of Christchurch, who was charged with stealing a suitcase and clothes in the earthquake area. Dixon was sentenced to one montn s imprisonment, and the extension of his probationary period till he has reached the age of 21 years was also ordered.