STATE INSURANCE.

Otago Daily Times, Issue 19373, 8 January 1925, Page 8

STATE INSURANCE.

QUESTION OF A. MONOPOLY. COMMENT IN’ THE INSURANCE RECORD. (Feom Opb Own Correspondent.) LONDON, December S. In June of this year a telegram from Auckland announced that the New Zealand Government had appointed a commission to inquire into the advisableness of the State taking over tho monopoly of accident insurance business in the dominion. Tho editor of the Insurance Record made tho following comment;—“Wo should have thought that the New Zealand Government’s experiments in life assurance and tho ridiculous ease with which the Australian Mutual offices show better results, ought to act as a warning.” Mr A. T. Traversi, the commissioner of the Government Insurance Department in New Zealand, made a protest to this statement in a letter he wrote, and which was published in the Insurance Record last week. In the course of this letter Mr Traversi says;—“lt may be of interest to point out that your view is not shared hy the department’s competitors. The chairman of the New Zealand Board of the Australian Mutual Provident Society, speaking recently at the annual meeting of the society in Australia, said: ‘ln New Zealand they had to face the competition of the Government Life Assurance Department, which was probably the best managed State department of its kind in the world.” What is of even more importance is the verdict of the people of New Zealand. With soma 15 offices to select from, no less than onethird of the policies in force are with tho department.” Mr Traversi also draws attention to tho last annual report and triennial actuarial investigation, which shows that the Government Insurance Department is in at least as strong, if not a stronger, financial position than any of its competitors; and that, although the population of New Zealand is only about a million and a-quarter, tho Government Insurance Department has larger funds and writes a bigger annual new business than the majority of British offices with all the population of Great Britain to draw from. REPLY TO MR TRAVERSI. In the editorial columns the editor quotes the whole paragraph from which Mr Traversi drew his quotation concerning management. Hr A. de B. Brandon, it appears, addressed the members of the A.M-P. as follows; •’‘lt must not be forgotten that we have to face the active competition of the Government Life Assurance .Department, which, has been in existence as long as our own branch, and is probably the best-managed State department of its kind in tho world. That competition is of a perfectly legitimate nature, except that as regards taxation wo have been treated for the last few years as a ‘foreign corporation,’ and last year paid six times as much in taxes as was levied .upon the Government deportment—which has about the same amount of funds as our branch has. Notwithstanding that fact, our society has succeeded in doing more business at a lower ratio of expense, and to show in every essential particular a marked superiority over our State competitor.” SIR H. BEAUCHAMP’S STATEMENT. Sir Harold Beauchamp’s remarks at the annual meeting of the A.M.P. are also made use of; “It will be or interest to you to know how our business compares with that of the Now Zealand Government Life Department,” said Sir Harold Beauchamp on that occasion. “We opened our New Zealand branch about the same time that the department began operations, but at the end of 1922 our business in force with added bonuses exceeded the Government figures by £9,054,246. Our income is about a-quarter of a million more, and our expense ratio about one-third less than that of our rivals.” After further detailed demonstration the editor concludes: “The Government Insurance Department of .New Zealand ie capably managed and financially strong. Having 1 regard, however, to the very important factors that operate in its favour when in competition with privately controlled concerns —viz , the comparatively small sum it pays in taxation, and that every Government servant in New Zealand must automatically insure with the department, we consider our comment that ‘better results’ are shown by its competitors to be profectly true and quite fair.”