WIDE ACTIVITIES

New Zealand Herald, Volume 78, Issue 24104, 24 October 1941, Page 3

WIDE ACTIVITIES

ORIGIN OF PROFITS MOST FROM ABROAD MISAPPREHENSION CORRECTED ' Tho fact that tho major proportion of the business of the company was done abroad and only one-sixth of the past year's premiums came from New Zealand was stressed by Mr. V. J. Larner, chairman of directors of the South British Insurance Company, Limited, at tho annual meeting of shareholders yesterday. "Had wo been dependent on our profits made in New Zealand alone, they would not have sufficed to pay shareholders even the bonus of 6d declared this year," said Mr. Larner. "The aggregation of small premiums in tho hands of insurance companies, most of which pay the maximum rate of taxation, is of great benefit to the revenue of the country. A year of heavy losses must, be deplored even more by tho Treasury than by insurance companies. Spread of Business Correcting a popular misapprehension that the major portion of the insurance business of the Dominion was handled by the two Auckland companies, the chairman said the New Zealand and South British companies between them handled only about onefifth of that business. The remaining four-fifths was absorbed by the State insurance office, about three dozen other insurance companies, certain groups of Lloyds' underwriters and some mutual associations. ''Nor would we have it otherwise," added Mr. Larner. "Owing to the special earthquake hazards inherent in New Zealand, it- is not desirable that an undue share of tho insurance cover should be appropriated by any one concern, instead of having the risk distributed over such a wide range of organisations, many of them with very substantial funds invested in other parts of the world. Benefit to Dominion "I am not sure whether it is generally realised how beneficial to this Dominion. aro the operations of these locally-established insurance companies carrying on such an extensive business beyond these shores. The amount distributed to this company's shareholders for many years has been far in excess of anything we could hope to earn in Now Zealand, and as the great majority of our shareholders are resident here, this means that a large amount of foreign money is put in local circulation annually. "The extent of our world-wide resources enables us to give much more substantial support to Government loans than we could give if our business were confined to New Zealand. Similarly, when public appeals are made for subscriptions to patriotic and other causes, our response is in keeping with the company's position as a whole, not with its relatively modest local business."