LIFE INSURANCE.

Otago Witness, Issue 941, 11 December 1869, Page 7

LIFE INSURANCE.

(Morning Port,)

Investigation, instead of accounting for the position of the Albert Insurance Company, only makos it more unaooountable, and explanation as hitherto «»*•» only renders it more inexplicable. The advortuementa of the company, and a Parliamentary return recently prrourod and issued, represent that the policy holders have the security of on inveated cum

'with!' ! «bh'e;thirdt^called' ; iip£ ,} and± an iiicbme ' ■ of' { L357>;000>" 'inoreasin'gv.ak 'the "rate 1 'of -'L3S/000 a *yGar. ' -It jnow. appears 'jKhaVtherS* is> no reserve fund'nv the proper sense r 6f' the word \ thatalL ih'e policy holders 'h>ve to rely upon! is r 'a sum estimated- to bej but not -really sin hand, of L 421,000, andean ■estimated yield A of L150,q00- from ; the uncalled capital. :*: * Where the advertisedvreserve' fuiid 6f'L6sO;Ooa\has gone -to, is: not skated.' ,' 'Neither' is 'there- any attempt to account for the appropriation of the sums illegitimately drawn from the < < Indian • branch ; nor does, any one explain swhat have been the uses" to which the L 350,000 a year has been put. It ib under .these circumstances, • and on the strength of these 1 loose and uncertifieated statements, that ; a' board of "directorsj who have no claim ; whatever , upon the confidence of anybody, 'propose to .the victims of their management to 1 pay for the remainder of thoir lives the same premiums as they do tiowj and !tb receive in return the chance of their representatives getting at their death three-fourths of the sura which they have > insured.. We should imagine that the beat thing for j any man under fifty-five, with a good life, insurable at ordinary rates of premium, to do, would be at once to insure afresh in another well-reputed and longestablished office ; and, indeed, the main body of the policy holders will probably get out of the bad bargain, which may have a better result now, and a more certain future, by winding up the company, and forcing the utmost possible realisation out of the shareholders and directors, than by accepting the compromise that has been tendered to them. Then a question suggests itself. What will the other insurance companies do under these circumstances? The case of the Albert, which, aa investigation developes the facts of its administration, may be expected to show worse than it does even now, will undoubtedly give a very sensible check to the rapid progress which the practice of insuring life as a provision for families, or as a security, was making ; and it is by no means improbable that the middle classes may direct their attention to the facilities which are now tendered by Government for the accumulation of savings. Mr Gladstone's organisation for investing, insuring, and securing deferred annuities, as administered through the Post-office, is a most admirable institutioa, and it is perfectly safe. Probably a man gets a little more from an insurance company, and it has the advantage which the Government institution has not, in the case of the Savings Banks at leaßt— namely, that after a time the putting by money to meet the premiums assumes, morally at all events, a compulsory character. A man does not like, after he has been paying his LlO or L2O a year for four or five years, to lose the advantages which the payment has entitled him to by not coming to time with h»s premium. But bib feeling of obligation depends entirely upon the advantages leing seoure. Once introduce the element of uncertainty, and the entire attraction of insurance in a company is dissipated. A saving man had better become his own insurer. It would therefore probably be to the interest of the principal insurance companies to give to the public a full and clear explanation of their actual position, of their modes of doing business, and especially of investing their moneys, from time to time. The great insurance companies, and their experienced and intelligent officers, ought surely to be able to do something more than merely satisfy- the world of their own soundness. They might hold, we would suggest, a conference, and place before the public, novr really almost helpless from want of knowledge, •omo suggestions aa to the future. Something must be done. There must either be a Government supervision, or, 'if the caveat emptor principle is to obtain, there must be some moans placed within the veaoh of the emptor whioh shall enable him, with ordinary intelligence and consideration, to test the value of the thing for which he gives his money, and of ascertaining that its reality correiponda to its appearance. Ho must have the opportunity afforded him of ascertaining that his deeming nutmeg is not a wooden one, artistically grained and stained. At proa«Dt it is absolutely impossible for the emptor to do this in the case of an insurance company. The insurer is compolled to walk by faith and not by •ight. It is said that Government supervision answers in the United States. We should, we oonfeu, like to have more information aa to iia working than wo poaaea* at present before attempting to form a positive conclusion aa to the propriety of adopting it There may be aome doubt aa te> the applicability of the principle of Government inspection to auoh undertakings aa laauranoe offloea, and it ia questionable whether, If any other mod* could be

f olind'bfc Wablnlg !^Mina%>^espleJmth' koderateln^ligtfi^ »? bnrir VjudgmentPfolf^heimSelyes^rtp the o& v a,n-*6&o6»*in f >4rhiph!i '.they >p!rdpdßlng f 'to' effect' an ! insurance;, itjwould' uot ; Set 'preferable and fiftlrVin' accorcl'^with the organisation of {busk 'riesiS 1 'matters" in this ' country, ' -It is certainly the interest of, the (great jbody of -the insurance offices to findf ;and 'suggest such' a mode. .The' public fhave. found' Out that they are' utterly helpless^ and the discovery is' creating an ahlojint of distrust that' cannot fail to; produce before long very sensible effects iupon the revenues of even the highest class oMces. One more observation we deem it M our duty to make. '•*.' The insurer is' not,^ as some persons who have treated the subject represent him to be, a, speculator. He is strictly an investor and a contracting party in' an institution which ought' to meet its obligations as certainly as. the Bank, of England gives # gold for its notes, and would do so if its direction 1 were capable or honest. ■ ■