AN INSURANCE CASE.

Timaru Herald, Volume XIC, Issue 13394, 18 September 1907, Page 2

AN INSURANCE CASE.

AMALGAMATION OF OFFICES.

To-day a general meeting is to be.held in .Sydney of policy-lioldetw in the Mutual Life Association, tpjvcbnsider whether the jiroposed amalgamation with the Citizen:.-;' Life Assurance Company is. : expedient. A : provisional agreement, has been ( signed by :the respective boards of the ' companies concerned, whereby they agree to amalgamate, and the. proposed union will be given effect to, provided it is sanctioned by the policyholders of the Mutual Life Association and the shareholders- of the Citizens' Life Company. Circulars to ascertain the feeling of those interested have heensenfc but,- ~ . The 'amalgamation as proposed is regarded as the biggest thing of . the kind that has taken place in life assurance south of the line. The promoters consider that the arrangement- is an admirable one in .the .interests of- all concerned, ;ind that under the new conditions f.-uch advantages can be.-offered as will make the obtaining of new business easier. It is proposed that the operations shall take effect from January Ist next, at which time the combined companies will have over £4,000,000 of funds in hand, and' be responsible for over £16,000,00Q of assurances, while there will be over 267,000 policyholders looking to the new company for protection. The, agreement entered into provides- that the ' Citizens' shareholders guarantee that the Mutual Life' Association business will be worked at an expense ratio of 15 per cent, for the first year after amalgamation, 12i per cent for the second year, and 10 per cent thereafter. This, it is stated, means an immediate saving to the policyholders of the Mutual Life of the sum' of £25,000 per annum, while there can also be no doubt as to the advantage, of the scheme to,the Citizen shareholders. The M.L.A. was founded in 1869, sq that it is' just thirty-eight years old. The Citizens' commenced operations in 1887, and has completed its twentieth year. .The former office transacts ordinary life assurance, while, the latter .is a vigorous type of the industrial ordinary office, of which the Prudenlial of London, the iargest office in the British Empire, is thj great exemplar. : 'i"he amalgamated office will continue on these lines. The combined totals of the assuraiice in force on the several registers is not yet available in. eompletene-s from official returns, but in the Citizens it is over £10,000,000, while the M.L.A. should have over £6,500,000 making ovt'r £16,500,000. Reversionary bonuses probably raise the figures to over £I7,OCO,CCJ, in addition to which the office will be liable for annuity payments to the amount of something like £II,OOO per' annum. To give some idea- of how the amalgamated company will compare with the largest Australian companies and with that of the New Zealand Government Insurance Department, the following table has been prepared: Premium Policies.. Income. Funds. No. £ £ A. M. V ... 223,312 1,899,541 22,413,827 New ' Comjwny ... 267,935 640,694 3,868,592 National Mutual ... 71,366 58:,357 4,473,070 N. Z. Government ... 45,981 319.775 3,991,590 It will thus be s.-en ihat. the two largest companies, siz.. being ba;-:ed on premium income, have their headquarters in Sydney. Mr J. C. Remington will be managing tru.'.-tea arid a director of the new company, while Mr Jehu J. Garvnn will be managing director.