ANNUAL REPORT OF THE GOVERNMENT INSURANCE COMMISSIONER FOR THE YEAR ENDED 31st DECEMBER, 1947

Appendix to the Journals of the House of Representatives, 1948 Session I, H-08

H—B

1948 NEW ZEALAND

ANNUAL REPORT OF THE GOVERNMENT INSURANCE COMMISSIONER FOR THE YEAR ENDED 31st DECEMBER, 1947

Presented to both Houses of the General Assembly pursuant to the Provisions of the Government Life Insurance Act, 1908

Government Insurance Office, Wellington, 11th May, 1948. I have the honour to submit the following report upon the transactions of the Department for the year ended 31st December, 1947, and its position at that date. The Revenue Account, Balance-sheet, and Statement of Business are appended. New Business and Business in Force.—New business for the year amounted to 11,510 policies, assuring the sum of £7,052,219, the premiums thereon being £171,170 per annum. Thirty-three annuities were also granted, the purchase-money being £59,312. The total business in force at the end of the year (including immediate, deferred, and contingent annuities for £232,764 per annum) comprises 121,737 policies bearing an annual premium income of £1,190,935. The total sum assured is £50,999,042, to which reversionary bonuses amounting to £4,383,316 have been added. Income. —The total income amounted to £1,929,781, made up as follows: £ Premium income .. .. .. 1,311,990 Interest income (net) .. .. 558,479 Annuity-purchase money .. .. 59,312 The total for the year exceeded that for the previous year by £223,919.

H—B

Outgoings.—During the year 1,828 policies became claims by death of the life assured and by maturity, the payment involved being £685,723. The total amount paid in claims since the inception of the Department is £22,817,812. Accumulated Funds. —Assurance, annuity, and endowment funds, apart from special reserves of £620,000, now stand at £14,835,563, an increase of £725,046 on the previous year. Bonus Distribution. —The bonus investigation carried out by the Actuary discloses a net cash surplus of £245,796, including interim bonuses paid during the year, and this surplus enables bonuses to be allotted for 1947 to all participating policyholders at the same rates as for the previous six years. This result has been achieved after creating a reserve for income-tax of £90,000 and strengthening the actuarial reserves by the adoption of a lower interest basis for the valuation of liabilities. Expense Ratios. —The ratio of expenses to (a) total income and (6) premium income for 1945, 1946, and 1947 is as follows : Ratio of expenses to — 1945. 1946. 1947. (а) Total income .. .. .. .. 10-66 12-13 11-67 (б) Premium income .. .. ..16-37 17-77 16-42 Expenses ratios increased steadily of recent years owing to greater new business and to increased working-costs arising out of current economic conditions, but it is pleasing to record an appreciable reduction in the percentages for the last year, despite a further increase in the volume of new business. Investments. —In common with all life-insurance institutions, the Department has been faced with the twofold problem of keeping funds held against the performance of contracts adequately and safely invested, and of securing a reasonable return on those investments. Interest yields have continued to fall as maturing investments are replaced by lower-interest-bearing securities, and the end of the difficulties in this respect is not yet in sight. General. —The results for the year, have given cause for considerable satisfaction. An increased volume of new business has been written, the record figures for 1946 having been exceeded by over £500,000 ; the ratio of expenses has been reduced ; and the Department has been able to maintain its rates of bonus distribution and at the same time to change from an O m —3 per cent, basis to the more stringent A per cent, basis in the valuation of liabilities, thus providing a guarantee of stability in the Department's future operations. Apart from ordinary new business, the Department has gained ground in securing group and staff superannuation schemes. A full range of technical services combined with efficient management assures to employers and employees alike the best contracts available, a fact which is becoming more widely appreciated amongst the business community. It would not be fitting to conclude without a word of appreciation for the work of the members of the Department's staff (both office and field), who have co-operated so energetically throughout the year to further the interests of the institution which they serve. With a continuation of this enthusiasm on all sides the Department may well look to the future with every degree of confidence. H. L. Ryan, Commissioner.

2

H—B

Revenue Account op the Government Life Insurance Department for the Year ended 31st December, 194? £ £ Amount of funds at Ist January, 1947 .. .. .. 14,110,517 Death claims under assurance policies, including bonus Renewal premiums: Assurance, annuity, and endowment, additions .. .. .. .. .. .. 256,598 less reinsurance premiums .. .. .. .. 1,011,655 Endowment assurances matured, including bonus additions 415,168 New premiums (including instalments of first year's premiums Endowments matured .. .. .. .. .. 13,654 falling due in the year), less reinsurance premiums .. 162,729 Premiums returned on endowments .. .. .. 303 Single premiums: Assurance and endowment .. .. 137,606 Bonuses surrendered for cash .. .. .. .. 3,465 Consideration for annuities .. .. .. .. 59,312 Annuities .. .. .. .. .. .. 43,101 £ Surrenders .. .. .. .. .. .. 70,172 Interest, rent, and other income .. .. 568,488 Loans released by surrender .. .. .. .. 25,713 Less property expenses and war damage insurance Commission— £ premiums .. .. .. .. .. 10,009 New .. .. .. .. .. 105,381 N 558,479 Renewal. .. .. .. .. .. 9,381 114,762 Expenses of management .. .. .. .. 107, 397 Contributions to Public Service Superannuation Fund .. 861 Agents'retiring-allowances .. .. .. .. 2,187 Land and income tax .. .. .. .. 47,323 Property depreciation .. .. .. .. .. 6,630 Reserve for income-tax .. .. .. .. 90,000 Transfer to investment reserve .. .. .. .. 7,401 Amount of funds at 31st December, 1947.. .. .. 14,835,563 £16,040,298 £16,040,298

3

H—B

Balance-sheet op the Government Life Insurance Department on 31st December, 1947 Liabilities £ Assets £ Total assurance, annuity, and endowment funds (as per Loans on policies .. .. .. .. .. 748,514 Revenue Account) .. .. .. .. .. 14,835,563 New Zealand Government securities .. .. .. 7,210,096 Claims admitted, proofs not yet completed .. .. 77,488 Loans to local bodies .. .. .. .. .. 2,723,760 Annuities .. .. .. .. .. .. 376 Landed and house property .. .. .. .. 487,520 Medical fees .. .. .. .. .. .. 329 Landed and house property (leasehold) .. .. .. 5,500 Premium and other deposits .. .. .. .. 70,767 Mortgages on property .. .. .. .. 4,042,606 Sundry creditors .. .. .. .. .. 16,718 £ Accident and Fidelity Fund .. .. .. .. 5,000 Overdue premiums on policies in force .. .. 4,688 Reserve for income-tax .. .. .. .. 90,000 Outstanding premiums due but not overdue .. 114,440 Investment Reserve Account .. .. .. .. 525,000 119,128 £ Overdue interest .. .. .. .. 2,128 Sinking funds on local-body loans .. .. 3,708 Outstanding interest due but not overdue .. 5,886 Interest accrued thereon .. .. .. 46 Interest accrued but not due .. .. .. 141, 600 3,754 149,614 Sundry debtors .. .. .. .. .. 4,882 Income-tax paid in advance .. .. .. .. 40,000 Cash in hand and on current account .. .. .. 93,375 £15,624,995 £15,624,995 H. L. Ryan, Commissioner. W. K. Watson, Secretary. Government Life Insurance Department, 22nd March, 1948. The Audit Office, having examined the Revenue Account and Balance-sheet and compared them with the relative books, documents, and securities, hereby certifies them to be in accordance therewith.— J. P. Rutherford, Controller and Auditor-General.

4

H—B

H. L. Ryan, Commissioner. S. Beokingsale, F.1.A., Actuary.

Statement of Business for the Year 1947

5

Year 1947. Number. Sum assured. Reversionary Bonuses. Annual Premiums. Annuities. Ordinary. Extra. Immediate. Deferred. Policies in force at 31st December, 1946 New business Bonus allotted Total Policies discontinued during 1947 .. Total policies in force at 31st December, 1947 How Discontinued — By death By maturity By surrender By change to other tables By cancellation By lapse and alteration By expiry Total discontinued during year Progress of Business of the Total issued Total void Total in force Polici 114,224 11,543 'es issued ar £ 45,687,107 7,052,219 id discontinued du £ s. d. 4,235,873 4 0 342,080 8 0 ring the Year 1 £ s. d. 1,061,779 16 1 170,663 2 0 947 £ s. d. 2,246 9 2 506 19 0 £ s. d. 39,061 5 2 5,118 0 0 £ s. d. 114,573 14 2 87,596 16 0 125,767 4,030 52,739,326 1,740,284 4,577,953 12 0 194,637 14 0 1,232,442 18 1 44,170 15 8 2,753 8 2 90 10 11 44,179 5 2 —1,187 13 2 202,170 10 2 14,773 3 6 121,737 50,999,042 4,383,315 18 0 1,188,272 2 5 2,662 17 3 45,366 18 4 187,397 6 8 Particu 622 1,206 1,012 97 194 680 219 lars of Poli £ 207,852 323,169 492,030 57,944 90,519 320,281 248,489 cies discontinued c £ s. d. 54,711 8 0 103,140 8 0 25,911 4 0 3,282 17 0 266 8 0 7,325 9 0 luring the Year £ s. d. 6,836 13 9 12,506 14 2 12,509 12 7 776 12 10 2,067 16 10 9,187 7 5 285 18 1 1947 £ s. d. 22 15 5 21 11 6 20 3 6 17 0 4 1 8 17 2 10 3 9 0 £ s. d. 1,129 16 2 —2,317* 9 4 £ s. d. 888 0 0 144 0 0 7,788 3 0 3,303 13 0 2,649 7 6 4,030 1,740,284 194,637 14 0 44,170 15 8 90 10 11 —1,187 13 2 14,773 3 6 Govemme 325,925 204,188 nt Life Insi £ 109,406,006 58,406,964trance Department £ s. d. 11,582,028 11 0 7,198,712 13 0 ; since Date of j £ s. d. 2,925,932 3 11 1,737,660 1 6 Establishment £ s. d. 43,054 0 3 40,391 3 0 to 31st December, 1947 £ s. d. 392,962 18 6 160,198 13 6 121,737 50,999,042 4,383,315 18 0 1,188,272 2 5 2,662 17 3 232,764 '5 0

H—B

GOVERNMENT INSURANCE DEPARTMENT

STATEMENTS IN CONNECTION WITH THE VALUATION OF LIABILITIES (FOURTH AND FIFTH SCHEDULES) FOB THE TRIENNIUM ENDING 31st DECEMBER, 1947

Presented to both Houses of the General Assembly pursuant to Section 38 of the Government Life Insurance Act, 1908

7

H—B

REPORT BY THE ACTUARY RESPECTING THE VALUATION OF THE LIABILITIES UNDER LIFE POLICIES AND ANNUITIES OF THE NEW ZEALAND GOVERNMENT INSURANCE DEPARTMENT In terms of Section 36 of the Government Life Insurance Act, 1908

FOURTH SCHEDULE I The date up to which the valuation was made was the 31st December, 1947. II The principles upon which the valuation and distribution of profits were made were as follows : (1) Principles of Valuation. —In making the valuation no credit whatever has been taken for any loadings or extra premiums, and in no case has there been valued for inclusion among the assets a valuation premium greater than the pure premium derived from the A 1924-29 Ultimate table of mortality with 2| per cent, interest. The liability has been ascertained by taking the difference between the present value of the sums assured (including reversionary bonuses) and the present value of the valuation premiums. Where the original premiums have been reduced by the application of amounts received in consideration of the surrender of former policies the valuation premiums have been reduced by an equal amount. In all cases where an extra premium was payable the policy has been valued at the true age, and an additional reserve of one year's extra premium has been made. Adequate extra reserves have been made for limited-premium policies and the immediate payment of claims in the case of whole-life assurances, and allowance has been

8

H—B

FOURTH SCHEDULE —continued made for the actual incidence of the premium income. Endowments have been valued as sums certain payable at the end of their respective terms, 2-| per cent, interest being used. Annuities have been valued by the a (/) and a (m) Ultimate tables of mortality using 3 per cent, interest. Policies have been valued in groups where practicable. (2) Principles of Distribution of Surplus. —The divisible surplus is distributed among the policyholders entitled to participate as a compound reversionary bonus per cent, on sums assured and existing bonuses, the rate of such bonus for each class of assurance being determined as far as practicable by the profit earned. An interim bonus is also paid, at the same rate, in respect of those policies which may become claims before the next distribution of surplus. The divisible surplus has been converted into reversionary bonuses by means of the A 1924-29 Ultimate table of mortality with 2-| per cent, interest. 11l The tables of mortality used in the valuation were, (1) For assurances, the A 1924-29 Ultimate Table ; (2) For annuities, the a (/) and a (m) Ultimate Tables. IY The rates of interest assumed in the valuation were 2| per cent, for assurances and 3 per cent, for annuities. y The proportion of the annual premium income reserved as a provision for future expenses and profits is represented by the difference between the premiums actually payable and the valuation premiums, and amounts to 23-0 per cent, of the annual premium income. In addition, special provision has been made for future expenses and profits under assurances by limited premiums. VI The Consolidated Revenue Account for the period Ist January, 1945, to 31st December, 1947, is given on page 11. VII 1. The liabilities of the Department under life policies and annuities at the date of the valuation, showing the number of policies, the sums assured, and the amount of premiums payable annually under each class of policies, both with and without participation in profits, will be found in detail in the Valuation Summary given on page 12. 2. The net liabilities and assets of the Department, with the amount of surplus, are shown in the Valuation Balance-sheet given on page 11 VIII All participating policies in force at the date of the valuation share in the profits. The surplus is allotted in the form of compound reversionary bonuses which vest immediately and are payable with the sum assured in the event of a claim ; but, except in the case of short-term double-endowment policies, they do not acquire a cash value for surrender purposes until the policies to which they belong have been two years in existence. THE LIBRARY UNIVERSITY OF CANTERBURY CHRISTCHURCH, N Z

9

H—B

FOURTH SCHEDULE —continued. IX The results of the valuation are as follows : (1) The surplus arising during the year ended the 31st December, 1947, including a balance of £15,707 carried forward from 1946, was £245,796, of which amount £4,304 has been paid as interim bonuses during the year. (2) The surplus divided among the policyholders as at the 31st December, 1947, was £230,089, which has been converted into reversionary bonuses amounting to £371,600. The number of policies which participated was 90,930, assuring the sum of £31,663,939, or, including reversionary additions, £36,047,255.

(3) The following are specimens of the bonuses which have been allotted for the year ended the 31st December, 1947, to policies for £lOO issued under the present premium tables and upon which all previously allotted bonuses had been allowed to remain :

The cash values of the reversionary bonuses are computed by the H m Table of Mortality, with interest at 4J per cent. S. Beckingsale, F.1.A., Actuary.

10

Number Age at Entry, 20. Age at Entry, 30. Age at Entry, 40. Age at Entry, 50. Number of of Years in Reversionary Cash Reversionary Cash Reversionary Cash Reversionary Cash Years in Force. Bonus. Value. Bonus. Value. Bonus. Value. Bonus. Value. Force. Endowment Assurances Maturing at Age 80 £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. ' 5 15 0 0 6 1 15 0 0 7 8 15 0 0 9 11 15 0 0 12 11 5 10 17 0 0 7 4 17 0 0 9 5 17 0 0 12 3 17 0 0 15 9 10 15 1 10 0 0 9 3 1 10 0 0 11 11 1 10 0 0 15 6 1 10 0 0 19 9 15 20 1 13 0 0 11 7 1 13 0 0 15 0 1 13 0 0 19 3 1 13 0 14 4 20 25 1 16 0 0 14 3 1 16 0 0 18 7 1 16 0 13 8 1 16 0 1 10 2 25 30 1 18 0 0 17 3 118 0 12 2 1 18 0 18 1 1 18 0 1 18 0 30 Endowment Assurances.—Term 20 Years 5 110 0 11 4 110 0 11 6 110 0 11 9 110 0 12 5 5 10 12 0 0 14 6 12 0 0 14 7 12 0 0 14 11 12 0 0 15 3 10 15 14 0 0 19 4 14 0 0 19 5 14 0 0 19 6 14 0 0 19 8 15 20 16 0 16 0 16 0 16 0 16 0 16 0 16 0 16 0 20

H—B

FOURTH SCHEDULE— continued Consolidated Revenue Account of the Government Insurance Department for the Period commencing Ist January, 1945, AND ENDING 31ST DECEMBER, 1947 £ £ Amount of funds at Ist January, 1945 .. .. .. 13,129,718 Death claims under assurance policies, including bonus Renewal premiums: Assurance, annuity, and endowment, additions .. .. .. .. .. .. 842, 427 less reinsurance premiums .. .. .. .. 2,785,691 Endowment assurances matured, including bonus additions 1,305,532 New premiums (including instalments of first year's premiums Endowments matured .. .. .. .. 32,985 falling due in the year), less reinsurance premiums .. 392, 124 Premiums returned on endowments .. . . . . 1,698 Single premiums : Assurance and endowment .. .. 256, 680 Bonuses surrendered for cash .. .. .. . . 6,506 Consideration for annuities .. .. .. .. 117,339 Annuities .. .. .. .. .. .. 116,610 £ Surrenders .. .. .. .. .. . . 150,091 Interest, rent, and other income .. 1,673,308 Loans released by surrender .. .. .. .. 77,154 Less property expenses .. .. 27,829 Commission— £ 1,645,479 New .. .. .. .. .. 270,851 Renewal .. .. .. .. .. 25,064 295,915 Expenses of management .. .. .. . . 293, 366 Contribution to Public Service Superannuation Fund .. 2,359 Agents' retiring-allowances .. .. . . .. 6,850 Land and income-tax .. .. 232,742 Property depreciation .. .. .. . . 19,832 Reserve for income-tax .. .. .. .. 90,000 Transfer to Investment Reserve .. .. .. 17,401 Amount of funds at 31st December, 1947 .. .. 14,835,563 £18,327,031 • £18,327,031 Valuation Balance-sheet of the Government Insurance Department as at 31st December, 1947 Dr. £ Cr. £ Net value of liabilities (as per valuation summary) .. 14,594,071 Accumulated funds (as per Consolidated Revenue Account) 14,835,563 Surplus ~ .. .. .. 241,492 £14,835,563 £14,835,563

11

H—B

FOURTH SCHEDULE— continued Summary and Valuation of the Policies of the Government Life Insurance Department as at 31st December, 1947

12

Valuation Particulars of Policies for Valuation. (the bases used are those stated in Section II (1) of the Descrintion of Transactions. Fourth Schedule). Number of Sums assured Office Yearly Net Sums assured Office Yearly Net Net Policies. and Bonuses. Premiums. Premiums. and Bonuses. Premiums. Premiums. Liability. ASSURANCES I.—With Participation in Profits £ £ £ £ £ £ £ Whole-life assurances .. .. .. 10,886 6,439,261 168,079 116,316 3,382,138 2,933,437 2,028,313 1,353,825 with extra profits .. 185 132,588 2,900 2,169 90,058 40,698 30,439 59,619 Endowment assurances .. .. .. 75,238 28,078,405 786,253 607,656 17,944,262 10,540,228 8,124,861 9,819,401 with extra profits .. 217 88,277 2,146 1,813 76,040 14,752 12,461 63,579 Double-endowment assurances .. .. 2,333 817,823 15,583 13,943 730,663 61,166 54,741 675,922 Deferred assurances .. .. .. 18,401 12,997,874 101,724 76,889 2,959,570 3,052,121 2,306,960 652,610 Joint-life assurances .. .. .. 6 8,944 302 185 7,210 2,250 1,382 5,828 Simple endowments .. .. .. 2,055 479,167 17,951 16,867 325,802 202,218 190,002 135,800 Annuity assurances .. .. .. 10 2,790 101 93 2,212 50 47 2,165 Extra premiums payable .. .. .. .. .. 2,437 .. 2,437 .. .. 2,437 Total assurances with profits .. 109,331 49,045,129 1,097,476 835,931 25,520,392 16,846,920 12,749,206 12,771,186 II. —Without Participation in Profits Whole-life assurances .. .. .. 3,988 1,843,886 48,526 41,129 1,241,347 557,720 472,680 768,667 Endowment assurances .. .. .. 320 91,950 2,514 2,376 72,503 17,625 16,657 55,846 Deferred assurances .. .. .. 17 6,050 72 66 3,034 1,295 1,182 1,852 Joint -Hfe assurances .. .. .. 3 1,217 29 22 786 476 363 423 Temporary assurances .. .. .. 7,476 4,280,740 .. .. 294,457 .. .. 294,457 Sinking-fund assurances .. .. .. 14 113,386 4,296 4,167 71,092 40,737 39,515 31,577 Extra premiums payable .. .. .. .. .. 226 .. 226 .. .. 226 Total assurances without profits .. 11,818 6,337,229 55,663 47,760 1,683,445 617,853 530,397 1,153,048 Reserve for prepaid loading, &c. .. .. .. .. .. .. 132,791 .. .. 132,791 Total assurances .. .. .. 121,149 55,382,358 1,153,139 883,691 27,336,628 17,464,773 13,279,603 14,057,025 ANNUITIES Immediate .. .. .. .. 543 45,367 .. .. 434,761 .. .. 434,761 Deferred .. .. .. .. 45 120,786 34,440 33,407 561,639 480,477 466,067 95,572 ♦Contingent .. .. .. .. .. 66,611 3,356 .. 6,713 .. .. 6,713 Total annuities .. .. .. 588 232,764 37,796 33,407 1,003,113 480,477 466,067 537,046 55 382 358 Total of results .. .. .. 121,737 'and 1,190,935 917,098 28,339,741 17,945,250 13,745,670 14,594,071 232,764p.a. * These annuities are part of family income assurance contracts —the basic assurances in each case have been included under their respective classes above.

H—B

REPORT BY THE GOVERNMENT INSURANCE COMMISSIONER In terms of Section 37 of the Government Life Insurance Act, 1908 FIFTH SCHEDULE Question 9. The average rate of interest at which the funds of the Department were invested at the close of each year during the period since the last investigation. Answer : The effective rates of interest credited to the funds of the Department for each year of the triennium were as follows : £ s. d. 1945 .. .. .. .. .. ..437 1946 .. .. .. .. .. ..400 1947 .. .. .. .. .. .. 3 18 8 Question 10. A table of minimum values, if any, allowed for the surrender of policies for the whole term of life, and for endowments and endowment assurances; or a statement of the method pursued in calculating such surrender values, with instances of its application to policies of different standing, and taken out at various interval ages, from the youngest to the eldest. Answer : The minimum surrender values at present ruling for whole-life and endowment assurance policies issued at the present rates of premium are given on page 14. In the case of simple endowments, with return of all premiums at death of nominee, the premiums are returned without interest, as surrender value. Other endowments and children's deferred assurances are treated specially. Question 11. A statement to be furnished of the manner in which policies on unhealthy lives are dealt with. Answer: When proposals are made on lives which, although not of such inferior quality as to merit total rejection, are considered not to reach the requisite standard for insurance at the ordinary rates of premium, such proposals are accepted either at an increased premium or subject to a contingent debt. The true age is taken as the basis of surrender calculations. H. L. Ryan, Government Insurance Commissioner.

13

H—B

FIFTH SCHEDULE— continued Table showing the Minimum Surrender Value ruling at the Valuation Date in respect of Policies for £100

14

Whole-life Participating Assurance by Equal Endowment Endowment Assurances Endowment Assurances Annual Premiums for the payable in Twenty-five Years, or at payable in Thirty-five Years, or at True Whole Term of Life. at previous Death. previous Death. previous Death. Age at Entry. MINIMUM SURRENDER VALUES AT THE END OE 5 Years. 10 Years. 15 Years. 25 Years. 35 Years. 5 Years. 14 Years. 5 Years. 10 Years. 20 Years. 24 Years. 5 Years. 10 Years. 20 Years. 30 Years. 34 Years. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ S. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. 15 3 10 6 8 0 10 2 0 18 18 0 30 7 0 25 0 0 89 5 0 11 8 0 26 10 0 67 5 0 90 2 0 6 11 0 15 8 0 37 8 0 72 1 0 91 3 0 20 2 16 0 6 19 0 11 4 0 21 15 0 34 17 0 25 0 0 89 5 0 11 8 0 26 10 0 67 5 0 90 2 0 6 11 0 15 8 0 37 8 0 71 6 0 90 12 0 25 3 10 0 8 7 0 13 8 0 25 15 0 40 7 0 25 0 0 89 5 0 11 8 0 26 10 0 67 .5 0 90 2 0 6 11 0 15 8 0 37 8: 0 70 14 0 89 18 0 30 4 2 0 9 18 0 16 1 0 30 4 0 45 19 0 25 0 0 89 5 0 11 8 0 26 10 0 67 5 0 90 2 0 6 11 0 15 8 0 37 8 0 70 0 0 89 3 0 35 4 19 0 12 0 0 19 3 0 35 5 0 51 17 0 25 0 0 89 5 0 11 8 0 26 10 0 67 5 0 90 2 0 6 11 0 15 8 0 37 8 0 69 6 0 88 6 0 40 6 2 0 14 10 0 22 17 0 40 10 0 57 9 0 24 6 0 88 7 0 11 4 0 26 6 0 65 14 0 88 12 0 7 4 0 16 19 0 38 15 0 68 12 0 87 8 0 45 7 7 0 17 5 0 26 17 0 45 19 0 62 4.0 23 16 0 87 14 0 11 5 0 26 8 0 64 15 0 87 15 0 50 8 17 0 20 9 0 31 0 0 51 4 0 65 14 0 23 5 0 87 0 0 11 10 0 26 17 0 63 11 0 86 13 0 55 10 10 0 23 14 0 •35 10 0 55 12 0 69 16 0 22 12 0 86 1 0 12 2 0 27 12 0 62 9 0 85 9 0 60 12 3 0 27 5 0 39 16 0 58 10 0 77 17 0 21 12 0 84 15 0 Note. —In addition to the above values the full Hii 4 J. per cent, cash value of all existing ordinary bonuses is granted.

H—B

ACTUARY'S REPORT ON THE VALUATION OF THE GOVERNMENT INSURANCE DEPARTMENT AS AT 31st DECEMBER, 1947

Presented to both Houses of the General Assembly pursuant to Section 40 of *he Government Life Insurance Act, 1908

Wellington, 10th May, 1948. In accordance with, your instructions, a valuation of the Department's liabilities under its policies has been made as at 31st December, 1947, with the object of ascertaining the net surplus available for distribution amongst the policyholders, and in accordance with section 40 of the Government Life Insurance Act of 1908, and amendments, I have the honour to report as follows : The liabilities arise in respect of 121,737 policies assuring, inclusive of bonus additions, the sum of £55,382,358 and £232,764 immediate and deferred annuities per annum ; the office premiums thereon amounting to £1,190,935 per annum. The bases adopted for the valuation were as follows : (a) Endowments : per cent, interest without mortality. (b) All other classes of assurance : The A 1924-29 ultimate table of mortality with 2£ per cent, interest. (c) Annuities : The a (m) and a (/) ultimate tables of mortality with 3 per cent. interest. The net premium method of valuation was employed in respect of groups (a) and {b) above, and, in addition to the liability brought out on that basis, reserves were included for future bonuses, immediate payment of claims, and other contingencies. The valuation disclosed a total surplus of £245,796 as follows : £ Total funds at 31st December, 1947 .. .. .. 14,835,563 Less value of liabilities .. .. .. .. 14,594,071 Net surplus .. .. .. .. 241,492 Interim bonus paid during year .. .. .. 4,304 £245,796

15

H—B

I recommend that £230,089 of the above net surplus be divided amongst ail participating policies in the form of compound reversionary bonus on the sums assured and bonuses existing at the valuation date, at the undermentioned rates for each full year's premium paid during the year, and that the balance of the net surplus —viz., £11,403 —be carried forward : Policies issued under present premium tables— p er cent. Whole-life assurances and endowment assurances matur- £ s. d. ing at ages eighty and over .. .. ..140 Other endowment assurances .. .. ..100 Pure and double endowment assurances .. .. 017 0 Policies issued under closed premium tables .. ..100 S. Beckingsale, F.1.A., Actuary. The Government Insurance Commissioner, Wellington.

Approximate Cost of Paper.—Preparation, not given; printing (1,123 copies), £35 10s.

By Authority: E. Y. Paul, Government Printer, Wellington.—1948.

Price 6d.~\

16