COERCION.

Rangitikei Advocate and Manawatu Argus, Volume XXXIV, Issue 9653, 5 January 1910, Page 6

COERCION.

SPOON-FEEDING THE STATE

FIRE OFFICE

A gentleman interested in insurance matters states that Monday’s debate on the Estimates tor the State Fire Insurance Department would have been much mote interesting and informative (as far as the public are concerned) if members had been more fnliy acquainted with the facts. Particularly was this the case in respect of the point referred to by Mr Thompson as to the Department compelling mortgagers getting advances from the Government to take cover with the State office. , , “The position is a good deal more serious than the public has any idea of,’’ stated our informant. “For the past sis months the Government Advances to Settlers Department has pursued an active policy of forcing mortgagors into taking cover in the State Fire Insurance Company, going as far as to interfere with existing policies, though it has no legal right to do so, as the authorities are quite aware. One gentleman I know was very irate at being informed that he would have to change his policy from the office he had been accustomed to deal with to the State office, and he defied the Department to compel him to make the change. He was let severely alone after that. The threat that is held over mortgagors is that if they do not change their policies to the State office the Department will have to consider the necessity for recalling the advance made. Very simple, and, in a great number of cases very effective. “Every office in the town has received dozens of official notifications of withdrawals of policies from the Government Advances to Settlers Department,, signed by the head of the Department, Mr Peter Heyes, which policies are automatically transferred to the State office. “All this is direct interference with private enterprise. Yet the companies are large taxpayers and invest a good deal of money in Government securities. Other Government Departments act differently. The Public Trustee is quite fair, and the Government Life Insurance Department does not compel the mortgagor to insure with the State office. Why should the Advances to Settlers Department? It is deliberate coercion. I don’t believe there is another .country in the world which would do such a thing. Another thing which the Government perhaps does not appreciate is that the public does not like it, and there is a considerable amount of grumbling at having to do so, particularly among old clients of different offices. “Some of the insurance people waited on the Hon. Mr Carroll last month, stating the case for the private companies in connection with the action of the Advances to Settlers Department, and they gathered from Mr Carroll |that existing policies would not be interfered with. The giving of a free hand to new mortgagors, however, was a matter that affected the Government policy, and one that would have to be submitted to Cabinet. They would hear from him again on the point. That was early last month, but so far no letter has been received from Mr Carroll.”