CHAMBER OF COMMERCE.

New Zealand Times, Volume LVIX, Issue 2875, 18 July 1896, Page 4

CHAMBER OF COMMERCE.

The President on the Question of State Fire Insurance. In his address at the quarterly meotingof the Chamber of Commerce yesterday afternoon Mr E. M. Simpson (president) said he could not lay before members a review of the state of the trade of the Colony, as the official returns for the last quarter were not available. The exports of wool for the J’ear ended June 30 were nearly 4-500 bales less than for the preceding year. The North Island exports, however, showed an increase of over 11,000 bales, of which Wellington could claim the credit of nearly 10,000 bales. The South Island, on the other hand, showed a falling off of close on 15,500 bales, the result, no doubt, of the disastrous storms of last winter. In frozen meat shipments, the North showed an increase of over three million pounds, but tho South a off of over four and a half millions. In tho census returns, Wellington had shown tho largest increase during the past five years. Wellington’s imports represented 10. V per cent, in 1871, now they represented 23 1-5 per cent, of the Colony. Its exports in IS7I represented less than (5 per cent., now they constituted nearly 15 per cent. He thought he might safely say that the proposed legislation iu reference to State fire insurance was opposed to the weight of opinion of members of tho Chamber. State insurance was apparently advocated on the assumption that the business as at preseat conducted had been found wantingin essential particulars,which could be obtained by Government control.lt was asserted that the profit to shareholders of these companies was too great, but to be of any value tho figures quoted ought to show a normal or average condition of tho business, whereas it was quite evident they were exceptional, and that it required the average fortunate and exceptionally unfortunate to fill tho complement of tho whole. If tho instances given were a fair average there would be no occasion to go to Coolgardie or tho Transvaal to make a fortune. The deductions were false and unreliable. With some trouble a small list of the abnormal successes had boon obtained. Tho list of companies which had come to ruin was ton times as long, but no mention was made of them. The publication of successful operations had prompted tho formation of companies, but tho majority of these undertakings had not survived for any lengthy period. Advocates of State insurance started with tho bait that the rates must be lower, and thus offered an inducement to all assured to support it. If it did not succeed only tho Government would pay, and it would not much matter. Tho benefit would bo reaped by the insured at the expense of the people as a whole. It was argued that because the Government Life Office was successful that a Government fire office must succeed also. It had boon successful because it was in capable hands, those of men who are acquainted with and followed the best precedents of the business. Yot it would be difficult to prove that any one assured person as such in tho Colony had received greater benefit from its establishment than they would have received from other mutual companies, Tho insured in a Government Fire Department would not see the necessity of making provision for tho contingency of a conflagration, the exact extent of which could not be demonstrated, and would never consent to the premiums being made sufficient to provide a large surplus over normal requirements for tho establishing in course of time a fund to meet the conflagration hazard. In a Government Department of .Fire Insurance there would be none of the present healthy rivalry; there would be no standard of excellence and no special interest to keep tho loss ratio down. The principal point urged in favour of State fire insurance was that it would be worked at a cheaper rate than the present system. If this was so, however, it was quits against all experience as to results in such cases. The most important part of the business was discrimination as to individuals and circumstances j but how could a Government official possibly distinguish between this person and that ? After criticising tho Bill, he moved “ That this Chamber views with grave apprehension the proposal to adopt a system of State fire insurance as being an undesirable interference with private enterprise, and a measure calculated to involve the finances of the Colony in serious responsibilities.” Mr J. B. Haroourb seconded the motion, which he believed would meet with the confidence of every commercial man in the Colony who had any knowledge of insurance matters, Mr A. de B. Brandon suggested that the reference to private enterprise be struck out, and that the resolution should be based on the huge liability the Colony would run. Tho Chairman and seconder agreed to this alteration. Other members supported the motion. Mr D. J. Nathan said that the bulk of tho audience wore men directly connected with insurance companies, and they could only take one view of the case. (A. voice; No.) 'He said yes. There were two sides to every question. If they were able to get reinsurance in London, the question, of State fire insurance would nob have been advocated by some classes of people to the extent it had. The motion was then carried with only two dissentients Messrs Nathan, and McLellan. A hearty vote of thanks was awarded to tho president for his interesting address, and tho meeting concluded.