STATE FIRE INSURANCE OFFICE. ANNUAL REPORT OF THE GENERAL MANAGER FOR THE YEAR ENDED 31st DECEMBER, 1925.

Appendix to the Journals of the House of Representatives, 1926 Session I, H-06

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1926. NEW ZEALAND.

STATE FIRE INSURANCE OFFICE. ANNUAL REPORT OF THE GENERAL MANAGER FOR THE YEAR ENDED 31st DECEMBER, 1925.

Presented to both Houses of the General Assembly 'pursuant to the provisions of the State Fire Insurance Act, 1908.

State Fire Insurance Office, Wellington, 21st May, 1926. I have the honour to submit the twenty-first annual report of the State Fire Insurance Office for the year ended 31st December,-1925, together with Revenue Account and Balance-sheet. Income. —The total net income from all sources amounted to £207,418, being an increase of £17,118 over 1924. The net premium income was £176,664, as compared with £165,070 for 1924, the increase for the year being £11,594. At the end of the year policies on the books of the Office numbered over one hundred thousand. Claims. —The claims totalled £56,997, against £60,817 for 1924. This result may be considered as very satisfactory in view of the fact that (although final figures are not yet available) it is reliably estimated that the total paid in fire claims by all offices during 1925 exceeded the previous year, when claims amounted to £1,008,746, which is the largest sum yet recorded as having been lost by insurance offices in any one year. Uninsured property is not included in this total. The steady increase in fire losses in the last three years should direct public attention to the fact that fire waste is an irreparable loss, and fire insurance merely a method of distributing some part of that loss in the form of a tax on the insuring public. Working-expenses. —Exclusive of Government taxes (which amounted to 5-8 per cent.), Fire Board contributions (2-4 per cent.), and depreciation of Office premises (1-95 per cent.), the workingexpense ratio to premium income was reduced from 25-1 to 23-8 per cent., and inclusive of Fire Board contributions and depreciation of Office premises from 29-48 to 28-14 per cent. The average ratio for all offices for 1924 was 37-43 per cent. Surplus and Assets. —The surplus for the year, after making full provision for rebates, reserves, and depreciation and writing-down of Office premises, was £35,917. The assets totalled £604,096, showing an increase of £73,812 over the total for 1924. Bonus Rebate.-~The period for which the second rebate of 10 per cent, was declared expired on the 31st July, and was continued by resolution of the Board until the close of the financial year, 31st December last, when a third rebate was declared at the increased rate of 12£ per cent. The cost to bhe Department of its rebates has been as follows : Year 1923 (five months), £10,996 ; year 1924, £22,005 ; year 1925, £17,405 : total £50,406. This substantial concession represents only a part of the benefit derived by the public in consequence of the introduction of the State Fire system of rebates, each rebate a,s declared having been followed by the associated companies. In this connection the Government Statistician in his annual report for 1924 estimates that no less than £413,234 has been directly and indirectly saved to the public as a result of the rebates instituted by the State Fire Office. Comparative Summary. —The progress and position of the Office is briefly shown by the following comparative summary : — 1924. 1925. Income —■ £ £ Net premiums .. .. .. .. .. .. .. 165,070 176,664 Other receipts, including rents and interest .. .. .. .. 25,229 30,753 Outgo — Rebate 22,005 17,405 Claims .. .. 60,817 56,997 Ratio of working-expenses to premiums (per cent.) .. .. .. 29-48 28-14 £ £ Reinsurance Reserve Fund .. .. .. .. .. .. 5,000 5,000 Office premises written off .. .. .. .. .. .. 4, 000 4, 000 Rebate Reserve .. .. .. .. .. .. .. Nil 23,500 Reserves and Funds at 31st December .. .. .. .. .. 499,006 568,061 Total assets at 31st December .. .. .. .. .. .. 530,283 604,096 In conclusion I desire to express appreciation of the assistance given by the Fire and Accident staff throughout the year, particularly during the period when extra work was required in connection with the transfer of the Accident Insurance Branch in terms of the Government Accident Insurance Amendment Act, 1924. J. H. Jerram, General Manager.

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Revenue Account of the State Fire Insurance Office for the Year ended 31st December, 1925. £ s. d. £ s d. Premiums after deduction of reinsurances 176,664 14 8 Bonus rebate to policyholders .. .. 17,405 3 2 Other receipts—lnterest, commisson, and Losses by fire (after deduction of reinsurrent .. .. .. .. 30,753 8 4 ances) .. .. .. .. 56,997 12 1 Appropriated to reserve for unearned premiums (in addition to £66,028 os. 6d. already reserved) .. .. .. 4,637 17 4 Government taxes .. .. .. 10,242 18 9 Commission .. .. . . .. 9,404 1 6 Salaries .. .. .. .. 21,416 7 11 ' Contribution to Public Service Superannuation Fund .. .. .. 636 8 1 Contributions to Fire Boards under the Fire Brigades Act, 1908 .. .. 4,241 411 Expenses of management— £ s. d. Travelling-expenses .. 1, 686 2 3 Printing, stationery, and advertising.. .. 1,920 10 3 Rent .. .. 1,944 1 4 Exchange .. .. 33 4 2 Postages, telegrams, ; cablegrams, and sundry charges .. 2,797 4 2 8,381 2 2 Office equipment .. .. .. 2,200 15 2 Office premises—depreciation .. .. 3,437 7 10 139,000 18 11 Reinsurance Reserve Fund .. .. 5,000 0 0 Office premises—Written off .. .. 4,000 0 0 Bonus Rebate Reserve .. .. 23,500 0 0 Amount of fire-insurance funds at end of year .. .. .. .. 35,917 4 1 £207,418 3 0 £207,418 3 0 1 i 1 111 Balance-sheet of the State Fire Insurance Office on the 31st December, 1925. Liabilities. Assets. £ s. d. £ s. d. £ s. d. Government war loan securities .. 138,470 17 0 Capital authorized by the Other Government securities .. .. 93,550 0 0 State Fire Insurance Local-authority securities .. .. 30,200 0 0 Act, 1908 .. .. 100,000 0 0 Fixed deposits and at short call .. 55,000 0 0 Less not raised .. 100,000 0 0 Land and buildings .. .. .. 224,876 5 1 ■ Nil Outstanding premiums .. .. 8,606 3 9 Reserve Fund .. .. .. 412,978 11 3 Interest accrued but not due .. .. 3,668 511 Investments Fluctuation Reserve Fund.. 10,000 0 0 Rent accrued or due .. .. .. 91 18 9 Reserve for unearned premiums .. 70,665 17 10 Cash in Bank of New ZeaBonus Rebate Reserve .. .. 23,500 0 0 land at Wellington, or in £ s. d. Reinsurance Reserve Fund .. .. 15,000 0 0 transit to Wellington .. 48,613 19 1 Premiums and other deposits .. .. 998 7 3 Imprest Account Outstanding fire losses .. .. 4,156 0 0 balances— £ s. d. Government taxes .. .. .. 10,242 18 9 Head Office 524 11 1 Sundry creditors .. .. .. 6,447 3 4 Auckland .. 0 5 8 Other amounts owing by the Office— Hamilton .. 12 611 Reinsurance premiums £ s. d. N. Plymouth 134 12 8 due .. .. 11,353 1 1 PalmerstonN. 58 18 6 Commission .. .. 1,747 10 1 Napier .. 18 10 3 Rent . . .. 77 17 6 Nelson .. 55 9 10 Printing, stationery, and Christchurch 89 13 3 advertising.. .. 51 1 7 Timaru .. 27 18 4 Postages and sundry Dunedin .. 70 5 4 charges .. .. 960 811 Invercargill 26 0 3 ; — 14,189 19 2 1,018 12 1 Fire-insurance funds, as per Revenue Account .. .. .. .. 35,917 4 1 49,632 11 2 £604,096 1 8 £604,096 1 8 Bth March, 1926. J. H. Jerram, General Manager. C. B. Redward, Accountant. I hereby certify that the Revenue Account and Balance-sheet have been duly examined and compared with the books and documents submitted for audit, and correctly state the position as disclosed thereby.-—G. F. C. Campbell, Controller and Auditor-General.

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