3

H.—l6

■which generally attaches to what may be termed speculative gains. "With regard to the profits yielded by the Government Insurance Department there is an element of certainty that should not be overlooked. From the very moment of the entrance of a policy-holder he is practically the recipient of an annual bonus in the shape of an immediate saving. This arises from the very lowrate of premiums, which in this respect are unequalled by any British or Colonial institution of the kind, with one single exception, a Scottish office. In order to illustrate this immediate saving, the subjoined figures, referring to Australasian institutions, are copied from an elaborate and instructive table compiled by Mr. Morrice A. Black, the accomplished actuary of the leading Australian assurance society. The table gives examples of the rates of premium charged by different offices at age 35 for an assurance of £100 for the whole term of life by even annual premiums. The " net premium" ia £1 19s. 5d., being that for a healthy male according to the table of the Institute of Actuaries. What is termed the " loading," as levied by the various offices, and to which special allusion is now made, is set forth in the table as given below: —

The loading, per se, in all the six foreign cases enumerated ranges from 56 to 105 per cent, above the very moderate loading which marks the tables of this Department. Hence, the average policyholder in the New Zealand Government Insurance Office receives an immediate advantage, as compared with what is offered by other Australasian institutions, extending to so much as Bs. 2d. on the premium payable for every £100 insured. In other words, between the two most prominent examples enumerated in the foregoing table, there is a difference in the rates of premium to the extent of fully 17 per cent., that difference in the case referred to being in excess of the rates charged by the Grovernment Department. The advantage thus arising to the policy-holder in this office continues yearly during the whole term of the policy, and is practically equivalent to an annual bonus, for the money, instead of being paid away, is retained in the pocket of the assured person. This, together with the comfortable security afforded by the Government guarantee, and the fact of the profits being secured by law to the policy-holders, will largely account for the rapid growth and present position of the Government Insurance Department. • D. M. Ltjckie, ■ Commissioner.

STATEMENTS OF ACCOUNTS. SECOND SCHEDULE. Revenue Account of the Government Insurance Department (Ordinary Branch) for the Year ended 30th June, 1879. £ s. d. £ s. d. Amount of funds at the beginning of the Claims under policies, Assurance ... 30,300 0 0 year (as per last published Revenue Ac- Annuities ... ... ... 1,845 16 7 count) ... ... ... ... 292,523 2 4 Surrenders ... ... ... 3,553 7 3 Renewal premiums — Assurance, Annuity, Commission, New ...£3,315 11 8 and Endowment ... ... ... 100,725 17 5 „ Renewal ... 934 6 2 New premiums on 2,071 policies, assuring 4,249 17 10 £686,283, and yielding an annual revenue Expenses of Management— of £^1,347 los. 6d. ... ... ... 11,156 13 0 Salaries, Head Olliee ... 4,496 4 8 Single premiums—Assurance and Endow- „ Branch Offices and ment ... ... ... ... 926 13 8 Agents ... 3,169 17 2 Consideration for Annuities granted ... 3,049 0 7 Medical fees ... ... 2,617 9 0 Interest ... ... ... ... 16,737 911 Travelling expenses, Agents 1,515 13 6 Fees ... ... ... ... 26 710 „ Others 116 310 Advertising ... ... 203 8 0 Printing and stationery ... 403 1 7 Rent ... ... 65 12 0 Postage ... ... 475 0 0 Telegrams ... ... 68 16 0 Exchange ... ... 12 14 6 Office furniture, depreciation ... ... 76 0 0 General expenses ... 86 6 1 13,306 6 4 Amount of funds at tho end of the year (as per Third Schedule) ... ... 371,889 16 9 £425,145 4 9 £425,145 4 9

Name of Institution. Premium charged per£100 at age 33. Loading contributed. Percentage of Loading on Premium charged. Australian Mutual Provident Society Mutual of Victoria National Mutual (Victoria) Mutual Life Association of Australia Colonial Mutual of Victoria Australian Widows' Fund New Zealand Government... £ 8. d. 2 15 4 2 14 9 2 13 3 2 12 7 2 11 9 2 11 6 2 7 2 £ s. d. 0 15 11 0 15 4 0 13 10 0 13 2 0 12 4 0 12 1 0 7 9 28-7 28-2 260 250 23-8 235 165