ANNUAL REPORT OF THE GOVERNMENT INSURANCE COMMISSIONER FOR THE YEAR ENDED 31st DECEMBER, 1894.

Appendix to the Journals of the House of Representatives, 1895 Session I, H-08

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1895. NEW ZEALAND.

ANNUAL REPORT OF THE GOVERNMENT INSURANCE COMMISSIONER FOR THE YEAR ENDED 31st DECEMBER, 1894.

Presented to both Houses of the General Assembly pursuant to the provisions of the Acts relating to Government Life Insurance.

Government Insurance Office, Wellington, 23rd May, 1895. I have the honour to submit herewith the accounts and tables of business of the department for the year 1894, an d to report thereon in compliance with the law. New Business. —During the year 4,440 proposals, for a total amount of were received. Of the whole of the proposals submitted, 457 were deferred or declined. Of every 100 proposals received, 83 were accepted at ordinary rates of premium, 7 were loaded— i.e., accepted with an extra premium—and 10 were deferred or declined. From these figures it will foe manifest that due caution has as usual been exercised in the acceptance of lives. Of every 100 policies completed, 94 were at ordinary rates, and 6 with an extra premium, or the equivalent contingent debt. There were also granted 30 annuities, securing to their holders per annum. The following is a condensed summary of the new policies issued by the department during the year: —

In the General Section the policies issued were 2,699, assuring and in the Temperance Section 602 policies, assuring The most noteworthy characteristic of the year's new business is the continued increase in the demand for endowment assurances. This increasing willingness on the part of the public to make a provision for old age cannot but be regarded as satisfactory, especially as the majority of these endowments mature at advanced ages. The following table will show how the 1,801 policies of this class issued during the year mature, and it will be seen that short-term endowments form a very small proportion of the whole : —

No. Sum assured. Annual Premium. vVhole-life and term assurances Endowment-assurances Children's endowments Vnnuity-assurances 1.397 1,801 £"364,704 355.321 3.588 5,400* /"9.H9 13,296 149 286 30 43 \nnuities 3.271 30 £"1,165 P er annum £- 22 ,88o 20 + Total policies ... £"22,900 3.301

Maturing in No. of Policies. 35 years and over 30-34 years 25-29 „ 20-24 a 15-19 „ Under 15 „ 182 535 603 340 94 47 Total ... i,8oi. * And deferred annuities securin; '1,977 per annum. t And single premiums amounting to £11,780.

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The particulars of the new and discontinued business of the year, and the progress of thedepartment from its inception, are given in great detail in the annexed statement of progress of business. Civil Service Insurance Scheme. —Regulations were framed for the proper administration of "The Civil Service Insurance Act, 1893," an d during the year the scheme was started, and is now working smoothly. At the end of the year 43 annuity assurances had been issued, assuring £"5,400 at death, and entitling the survivors at age 60 to annuities amounting to £"1,976 16s. nd. per annum. One of these assured Civil Servants died during the year, and the sum assured, with accrued bonus, was paid to his family. There were also issued in connection with this scheme 24 assurances for £"6,068, and a deferred annuity for £"6 os. 4d. per annum. Premiums received. —The total new premiums received amounted to £"23,117, being slightly in excess of the previous year. The renewal premiums received amounted to £"219,307. The consideration for annuities granted during the year was £"11,780. Interest. —The interest earned during the year amounted to £"115,270, being £"7,172 in excess of the interest for the previous year. Total Revenue. —The total revenue from all sources showed an increase of £"7,794, and amounted to £"369,478. Claims under Policies. —Death claims arose under 278 policies through the deaths of 254 policyholders, representing (after deduction of contingent debts) a total sum assured, including bonus additions, of £"88,683. Matured endowment assurances and children's endowments amounted to £"25,285. Since its foundation the department has paid in claims considerably over a million sterling. Expenses of Management. —The expenses of management (including commission £"14,626, and land- and income-tax £"5,917) amounted to £"55,722. This amount was considerably increased by the inclusion of the necessary expenses in connection with the periodical bonus investigation, an item which will not recur this year. Accumulated Funds. —The funds have increased by £"135,649, and at the end of the year amounted'to £"2,264,239. General Remarks. —lt is an appropriate time to draw attention to the fact that, the department having been founded early in 1870, the end of last year saw the completion of the first quarter of a century of its existence. The following table contains a Consolidated Revenue Account of the department from March, 1870, to 31st December, 1894 : — Consolidated Revenue Account for the Period between March, 1870, and 31st December, 1894. £ £ Premiums .. .. .. .. 3,467,421 Claims by death .. .. .. .. 990,540 Consideration for annuities .. .. 113,203 Claims by maturity .. .. .. 140,429 Interest .. .. .. .. .. 1,081,558 Surrenders .. .. .. .. 328,840 Fees, &c. .. .. .. .. 613 Surrender of bonus .. .. .. 92,486 Annuities .. .. .. .. 71,436 Commission .. .. .. .. 184,804 Expenses of management .. .. .. 492,679 Taxes .. .. .. .. .. 52,631 Losses on properties foreclosed .. .. 1,711 Investment reserves .. .. .. 43,000 Amount of funds .. .. .. .. 2,264,239 £4,662,795 £4,662,-795 From this consolidated account can be seen at a glance the various items of income and outgo for the twenty-five years, and the table cannot fail to be of interest. The Government Insurance Amendment Act, passed in the last session of Parliament, extending the department's powers of investment in mortgages, is affording much assistance in the remunerative employment of the department's funds. Whilst from a variety of reasons the ruling rates of interest have latterly materially declined, the result of recent legislation appears to be manifesting itself chiefly in the equalisation of rates for large and small investments, and in present circumstances the department is experiencing little difficulty in obtaining eligible securities on terms which must be regarded as satisfactory, especially bearing in mind the statutory requirements as respects security, and the scrupulous regard with which they are observed. The commercial depression of last year pressed severely upon the life insurance institutions of Australasia, but the department has been fortunate in escaping any appreciable arrestment of its advancement. The new business has almost reached the high figures of 1893, whilst the progress of the business generally has not been exceeded by that of any other colonial life office. Any unfavourable features of the year's experience, such as a heavy lapse-rate, will be found to have been more than shared by all the other offices. In the face of great difficulties, every effort has been made by the officers of the department to make the year a success, and a careful study of the accounts and statements will probably lead to the conclusion that the department was never in a sounder or more prosperous condition than at the present time. Josephus H. Richardson, Commissioner.

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Bevenue Account of the Government Life Insurance Department for the Year ended 31st December, 1894. £ s. d. £ s. d. Amount of Funds at 31st December, 1893 2,128,589 18 0 Death claims under policies, Assurance, Renewal premiums — Assurance, An- including bonus additions .. .. 88,682 17 0 nuity, and Endowment .. .. 219,307 0 5 Endowment Assurances matured, ineludNew premiums (including instalments ing bonus additions .. .. 24,117 9 0 of first year's premiums falling due in Endowments matured .. .. 1,168 0 10 the year) .. .. .. .. 20,675 910 Premiums returned on endowments .. 65 7 2 Single premiums—Assurance and En- Bonuses surrendered for cash .. .. 17,008 7 5 dowment.. .. .. .. 2,441 911 Annuities .. .. .. .. 7,460 11 3 Consideration for annuities .. .. 11,779 15 0 Surrenders .. .. .. .. 21,400 7 3 Interest .. .. .. .. 115,270 710 Loans released by surrender .. .. 18,203 15 4 Fees .. .. .. .. 4 510 Commission, new .. £13,092 5 1 renewal .. 1,533 17 5 14,626 2 6 Land-and income-tax .. .. 5,916 19 10 Expenses of management—■ Salaries—Head Office £9,965 16 0 „ Branch Offices and Agents 5,303 5 11 Extra clerical assistance 1,507 14 7 Medical fees and expenses 4,838 6 4 Travelling-expenses 798 8 7 Advertising .. 948 14 5 Printing and stationery 1,511 6 5 Rent .. .. 2,116 7 6 Postage .. .. 1,813 8 7 Telegrams .. .. 469 3 4 Exchange .. .. 52 7 2 Office furniture depreciation .. .. 456 8 11 General expenses .. 2,720 8 3 Triennial expenses .. 2,472 5 1 Compensation for loss of office .. .. 205 3 3 35,179 4 4 Amount of funds at 31st December, 1894 .. .. .. 2,264,239 4 11 £2,498,068 610 , £2,498,068 610

Balance-sheet of the Government Life Insurance Department on 31st December, 1894. Liabilities. £ s. d. Assets. £ s. d. Total Assurance, Annuity, and Endow- Loans on policies .. .. 405,166 15 11 ment Funds (as per Revenue Account) 2,264,239 4 11 Government securitiesClaims admitted, proofs not yet com- Consolidated stock ..£680,079 0 0 pleted .. .. .. .. 15,985 16 4 Treasury bills .. 140,000 0 0 Annuities .. .. .. .. 3 10 10 Debenturesissued under Commission .. .. .. 1,077 011 "The Government Medical fees .. .. .. 578 11 0 Loans to Local Bodies Premium and other deposits .. .. 4,034 1 1 Act, 1886" .. 10,000 0 0 Fire-insurance moneys in suspense .. 50 0 0 Railway debentures Tontine Savings Funds .. .. 6,002 8 8 (guaranteed by GoReserve for possible depreciation in free- vernment).. .. 79,906 5 0 hold and mortgage securities .. 43,000 0 0 Debentures issued under " The Native Land Purchases Act, 1892" 15,000 0 0 Debentures issued under " The Immigration and Public Works Act, 1870" .. 1,938 3 4 926,923 8 4 Municipal Corporation debentures .. 105,244 3 0 County securities .. .. .. 1,000 0 0 Otago University debentures .. .. 15,000 0 0 Harbour Board debentures .. .. 49,000 0 0 River Board debentures .. .. 935 0 0 Town Board debentures .. .. 500 0 0 Landed and house property .. .. 127,61114 7 Office furniture (Head Office and Agencies) 3,993 5 2 Mortgages on property .. .. 517,079 18 11 Properties acquired by foreclosure .. 34,413 15 7 Overdue premiums on policies in force .. £5,756 9 6 Outstanding premiums due in December, 1894 30,260 19 0 36,017 8 6 Interest outstanding .. 2,840 5 7 Interest accrued, but not due .. .. 27,081 11 0 29,921 16 7 Agents'balances .. .. 3,058 9 7 Sundry accounts owing .. .. 1,417 13 6 Cash on current account .. .. 77,687 4 1 £2,334,970 13 9 £2,334,970 13 9 Government Life Insurance Department, Bth March, 1895. Josephus H. Eichardson, Commissioner. Audited and found correct. W. B. Hudson, Secretary. James C. Gavin, Assistant Controller and Auditor.

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Statement of Business

ASSURANCES. TAL. Whole-Ufe and Term Assurances. YEAR 1894. No. Cw, EeverAssured sionary Assurea. B onu g Amuial Premium. 1. Ordinary. 2. Extra. Annuities. »<>■ As s rea. £5 - Annual Premium. 1. Ordinary. 2. Extra. Annual Premium. polici: S ISSUED AND DISCON- £ £ £ s. d1239,357 17 9} I 4.646 15 4/ £ *• d- £ £ £ s. d. (138,713 11 61 \ 3,805 12 8J Policies in force at 33 at Dβ-1 cember, 1893 J 31.709 8,302,257 518,998 7,855 7 2 18,421 5,489,420 378,976 Bonus allotted aa at 81st] December, 1893 j 277,268! 192,132 New Business, 1894 3.3°! 729,013 48 ( 22,732 19 III 1 167 9 o] 3,142 2 6 1,397 364,704 48 J 9,035 5 4) I 113 14 6j Total 35,oio 9,031,270 796.314 (262,090 17 8) I 4, 8l 4 4 41 10,997 9 8 19,818 5,854,124 571,156 (147,748 16 ]0) 1 3,919 7 2) Policies discontinued during) 1894 } 2,103 524,981 70, 060 f 16,497 7 7l 1 327 8 9J 146 12 10 1,215 343,851 49,832 f 9,549 1 1) I 265 15 10j Total Policies in force at 31st 1 December, 1894 J (245,593 10 11 I 4,486 15 7) (138,199 15 9) i 3,653 11 4/ 32,907 8,506,289 726,254 10,850 16 10 18,603 5,510,273 521,324 particula: ,s o POLI CIES DISCONHow Discontinued. By Death 281 79,043 9,212 ( 2,411 19 7[ 1 57 18 101 I 1,154 8 1) I 6 5 11 i" f 3,404 10 11) ( 69 14 10/ 146 11 10 211 64,240 7,780: ( 1,637 18 8) ( 52 2 4/ Maturity 102 21,643 3.553 Surrender 417 108,602 7.310 232 70,042 5,859 f 1,963 4 2) I 55 2 10[ Surrender Bonus 36,000 26,887 f 4,955 18 3) 1 116 7 8J Lapse 1,303 315,693! ! 13.985 I 8,654 14 4l i 149 16 2) 772 209,569 9,806 Expiry Policy .. / 7S0 5 0) [ 12 11 0) f 11 15 Oi 1 29 12 Oj Expiry Premium Miscellaneous j 79O 7 31 ( 12 11 o j J 81 7 5) I 3i 2 oj J 16,497 7 71 I 327 8 9) 010 2,103 524,981 70,060 146 12 10 1,215 343,851 49,832 J I 9,549 1 1) 265 15 lOJ PR GRESS OF B SINESS O THE G iVERNMENT INSURANCE 'otal issued 62,225 16,356,847 1,117,670 J489,622 16 101 | 12,684 X 9 Ix f j244,029 6 91 t 8,198 4 4/ 13,950 2 O ■ 35,19710,583,690 804,767 16,594 5,073,417 283,443 (278,804 7 10) I 10,164 18 2} J140,604 12 II I 6,511 6 10f 'otal void 29,318 7.850,558 391,416 3.°99 5 2 Total in force .. 10,850 16 10 18,6031 5,510,273 521,324 1138,199 15 91 I 3,653 11 4) 32,907 | 8,506,289 726,254 245,593 10 1 Extra Premiums Reduction of Premium by Bonus, &c. 4,486 15 7 297 1 i 3 Note.—The Ordinary Premium is the premium charged £250.377 18 11 Wellington, i\th February, 1895.

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at end of Year 1894.

JOSEPHUS H. RICHARDSON, Commissioner. MORRIS FOX, Actuary. r I

. i Approximate Cost of Paper. —Preparation, not given; printing {1,600 copies), £5 7s. 3d.

By Authority: Samuel Costall, Government Printer, Wellington.—lB9s. Price 6d. 2—H. 8.

ASSURANCES. ANNUITIES. SIMPLE 3OWMENTS, INISTMENTS, &C. Endowment Assurances. Annuity Assurances. I - ~ £5 ,*5St J N °- " Annies. p ™. 2. Extra. Annuity Assurances. EN VI No. &A A *»^ No. Sum Annual Assured. Premium. TINUED DURING THE YEAR 1894. £ £ £ s. d. J 99,432 10 0 1 { 841 2 8) £ £ s. a. £ s. a. £ s. a. £ s.d. £ £ s. d. 12,723 2,783,433 140,022 154 23 12 2 7,855 7 2 411 29,404 1,188 3 7 85,136 1,801 355,321 j 13,242 3 10) I 53 14 6) 43 5,400 1,976 16 11 286 6 0 20 0 0 1,165 5 7 30 3,588 149 4 9 30 14,524 3,138,754 225,158 (112,674 14 4 i { 894 17 2f 43 5,400 1,976 16 11 286 6 0 184 43 12 2 9,020 12 9 441 32,992 1,337 8 4 829 177,743 20,228 ( 6,807 7 7) I 61 12 li; 100 49 11 10 5 0 0 97 1 0 55 3,287 135 18 11 13,695 2,961,011 204,930 (105,867 6 9) \ 833 4 8J 42 5,300 1,927 5 1 281 6 0 181 43 12 2 8,923 11 9 380 29,705 1,201 9 5 T] :nued dur: :ng the y: iAR 1894. 66 14,703 1,432 f 569 0 111 \ 5 16 6[ ( 1,099 19 10 I 1 6 5 11 J I 1,411 0 1) I 14 12 Of 1 100 49 11 10 5 0 0 <J7 0 0 78 i 20,475 3,553 24 1,168 54 8 3 166 i 37,605 1,951 19 955 30 6 8 I I 9,113 j 3,658 6 II 1 33 8 6J 519 104,960 4,179 12 1,164 40 10 0 10 2 3 f 58 18 51 I 1 10 0) 0 10 10 14 0 829 177,743 20,228 f 6,807 7 7) I 61 12 11 J 100 49 11 10 5 0 0 135 18 11 97 1 0 55 3,287 d: EPARTJ MEN! 1 SINCE DA' P E iTABLISHMENT TO 31st ECEM ,R, 1894. I 14,897 5,671,729 312,903 (205,703 10 7) { 2,520 1 9f J 99,896 3 10] \ 1,686 17 6| 43 5,400 I 1,976 16 11 286 6 0 247157 ' 49 11 10 5 0 0 66113 li i i i 247157 7 5 66113 15 3 11,973 5 1 1,841 96,028 4,611 5 0 .1,202 2,710,718 107,973 1 100 3,049 13 4 1,455 66,323 3,409 15 7 :-i,695 2,961,011 204,930 (105,867 6 9) t 833 4 3J r-j. 5,300 1,927 5 1 281 6 0 181 43 12 2 8,923 11 9 386 29,705 i;201 9 5 at the true age; the exti ,, the additional pre: lium imposed for any reason whatsoever.