LIFE INSURANCE DEVELOPMENT.

Wairarapa Age, Volume XXVIII, Issue 7957, 6 February 1906, Page 5

LIFE INSURANCE DEVELOPMENT.

AMERICAN COMPANIES WITHDRAW FROM AUSTRALASIA. THE FUTURE PROSPECTS. The surprise of the moment in insurance circles is the unexpected decision of the American insurance companies operating in Wow Zealund to cease doing new business. The first public intimation came in the shape of a cable message on Saturday, stating that the President of the Equitable Life Assurance Society of New York bad announced that the society "had ceased to accept new business in Australia and other unprovable quarters of the world." A reporter made enquiries on the subject from Mr A. Trevor (Jould, the General Manager for New Zealand of the Equitable Life. Mr Gould said that his first information came by cable on Friday. He did not conceal the fact that the turn of events had surprised him, and everybody else in the insurance community. He could offer no explanation of the course adopted. It may be that the Australasian business is too expensive to warrant further operation, but of that he can say nothing. Lately, he said, there had been indications that the companies in America were inclining towards a limitation of business and towards a checking of further enormous expansions. Perhaps it was deemed advisable to take steps in this direction before being legislated into it. He did not know that there had been any official bint concerning \ legislation of this oharaoter, but it was not unlikely that the enquiry now proceeding into the life insurance transactions of New Yoru companies might bear the fruit of recommendations in the direction of limiting the operations of companies. Asked as to the future proceedings of the New Zealand branch, Mr Gould seid complete arrangements would be made to carry on the business already on the books. He had already telegraphed the agencies to acoept no new business. There would be no inoonvenienoe to policyholders, and quite adequate ar-. rangements would be made for the payment of premiums, the settlement of claims, and other business conneoted with existing polioies. Probably an attorney would be appointed to louk after the New Zealand business, and the Bank of New Zealnd would no doubt collect the premiums.. On this point, however, Mr Gould is waiting advice. The New York Life Assurance 'Company, be mentioned, had already practically ceased hunting for new business, although it is understood that it will acoept any new business that voluntarily offers itself. Mr Gould supplied details of the wording of the Equitable Life here. The new business has averaged a quarter or million anuually for the last five years—the 'new business of 1903 rising to over £360,000. Altogether the business done in this country exceeds a million sterling. Last year, in spite of the fact that for months sensational revelations were being wired from New York, the new business was £246,000 — whioh some insurance peoplo regard as equal to half a million in ordinary circumstances. The New York Life has not done such extensive business, its average being rather under £IOO,OOO. In Mr Gould's opinion, the annual £250,000 being resigned ny the Equitable will not all be divided amongst the other companies in certain, or uncertain, proportions. He thinks a good deal of it, say, £IOO,OOO, will be lost. He mentioned that the Society had withdrawn from New Zealand before, but «n this occasion the withdrawal affects all Australasia. The agents of the Society will be open to engagement now, and Mr Uould says there is plenty for them to do. He wished particularly to emphasise the fact that the present policy-holders will not be prejudiced in any way. If the withdrawal is part of- a scheme to economise and run the Society on less expensive lines the policyholders will eventually benefit by receiving increased bonuses. There are no other American companies operating in New Zealand besides the Equitable and New York Life.—Post.