STATE FIRE INSURANCE.

Otago Witness, Issue 3619, 24 July 1923, Page 65

STATE FIRE INSURANCE.

so:* PROFIT OF £46,403. (Fkoij Ocr Own Correspondent.) WELLINGTON. July 19. The net premium income for the State hire Department for the year 'I. aS a few thousands more than that for the previous year. This is considered satisfactory in view of the heavy fail in the values of buildings and stocks that took place, which reduced the demand for insurance coyer. The losses show an increase of £7965. This was expected, as during the period of high values the loss ratio fell in a remarkable degree. On the other hand, the fall in values since the boom has been accompanied by a great increase in the number of fires, and a sub stantial loss ratio to all offices doing business in the dominion. “It is,” says the general manager, “quite apparent that a large proportion of the outbreaks are of a preventable character.” The net profit for the year was £16,403. as compared with £39,325 for the previous year. The total assets at the end of the year were £447,605, as compared with £4-05,301 for _ 1921. It is stated that the amended legislation should enable a satisfactory settlement of the rebate grant to be made to the insured. The previous proyis.ons for a bonus were not workable during the year. There has been greatly increased competition, due partly to the reduction in the amount of new business available, and partly to the entry of several new offices into the competitive field. Ono result has been that the reasonable caution in values has in many cases militated against the business of the carefully conducted offices to the temporary advantage of less careful competitors. Another result lias been the illegitimate use of the agency appointment system, whereby unwarranted rebates have been paid to attract business. The practice has assumed somewhat serious proportions to the great disadvantage cf those offices which sanction only legitimate agency appointments, and some effective method of dealing with this difficult quesMon may require early consideration. The question cf the investigation of the loss experience of a few offices is under considers lion by the Government Statistician, who has power to ask for the necessary data. The regrading of the rates of premiums is said to be necessary both from the point of view of the cost to the public and the equities as between the different classes of risk.