ANNUAL REPORT

Southland Times, Issue 20833, 23 July 1929, Page 2

ANNUAL REPORT

GOVERNMENT LIFE INSURANCE. The annual report of the Government Insurance Commissioner (Mr A. E. Allison) recently laid before Parliament discloses highly satisfactory results during 1928— results which cannot be otherwise than of gratifying interest to the thousands of policyholders. The new business transacted amounted to the large sum of £1,915,465 (the greatest amount ever written by the Department in any one year) with new annual premiums thereon of £63,138. This brings the total amount assured (including bonus additions) up to the sum of £22,084,471 with annual premiums of £617,642. The annual income from premiums and interest (after deducting land and income tax of £22,194) is now well over the million mark—to be exact it is £1,023,757. During the year claims by death and maturity were met totalling £512,697, bringing the amount paid since the inception of the Department up to £11,244,750. The funds are now £7,796,028, all invested in New Zealand in sound securities and it can be claimed that the Department is a substantial factor in promoting the development of the Dominion, particularly when it is noticed that it has 'amongst the assets well over three millions of loans on mortgage of freehold securities. Another item in the report of special interest is the evidence of economical management, the ratio of expenses to premium income showing a reduction of 2 per cent, and to total income a reduction of 1.2 per cent, since 1926. This very substantial saving expressed in pounds, shillings and pence means an actual reduction in expenses of £4514 (notwithstanding the increases in new business and in total business and the additional costs incurred by the institution of an annual division of profits) and obviously has an important bearing on profits. The gross average rate of interest lor the year was £5 16/- per cent., but the payment of the before-mentioned land and income tax of £22,194 reduced this to a nett average rate of £5 9/9 which is nevertheless nearly 21 per cent, over the basis used (3 per cent. 0.M.) in valuing the Department’s liabilities. The system of annual bonuses adopted in 1927 is proving very attractive both to existing policyholders and to new insurers and the valuation as at the end of 1928 disclosed profits totalling £212,519, permitting the allotment of bonuses at the same high rates which were distributed the previous year.

To sum up, new business has been quite satisfactory, working costs have bqpn reduced, the funds have been kept closely invested at profitable rates, mortality has been less than the “expected” and the profits have been well maintained. In every respect, the record for the year discloses steady progress with every' encouragement and confidence for continued prosperity. (Published by Arrangement.)