SOUTH BRITISH INSURANCE CO.

Dominion, Volume 2, Issue 323, 9 October 1908, Page 10

SOUTH BRITISH INSURANCE CO.

■ CHAIRMAN'S.'ADDRESS. . " 'DISASTROUS" -LEGISLATION. „ [by -TELEGKArH—-PRESS ' AS3pCI ATION*.)^ • ■■Auckland. October 8. The, annual meeting •of shareholders in tho South British Insurance.Cqmpany.'w&s*held, today;.' Mr; J. H. Upton/ chairman Of directors/ presided. - , V", ' The'chairman, in moving the adoption of the reporl and -' b'alance,-sheetv' said:'""l may say first 'of- all that our operations illustrated somewhat strongly the'vicissitudes to which insurance business. is "subject,- "and exhibit the tendency' of it to run-in cycles of-good;-indifferent, and bad'. periods, a fact well understood by those, interested in'fire, mprine, and -accident underwriting, and it will, therefore, not be considered surprising !l(Jiat following upon several years of continuous prosperity we should have now to report,, for the -year, rosults less favourable than for . some ' preceding years. Comparing the revenue account with the previous year, the net premium income is less by .£15,511; to some extent, this falling off is explained by lower-rates prevailing in certain places, in consequence of unreasonable and severo competition; to trade depression in several countries, which has adversely affected , our marine business; but owing largely to our having given lip ah important ■ section of business, which wo found to be- unprofitable. The incomo from interests and rents show a small increase of .£lls, and totals ,£29,663, practically equivalent to our present dividend; losses show a decrease; of the, ratio being 63.10 per cent.,- against 65.53 per • cent; ■ for the previous year. Tne expenses show an increaso of .£10,636, the : ratio being, 32.25 per cent., :against -27.56 per cent.; this increase is, caused;to-some extent by the somewhat heavy-expenses connected with.turning the company into a limited liability'concern, the- expenses so : involved being oyor ,£3OOO. ■ Tho principle of limitation, of liability,. however, secures so manyadvantages to investors, that /it will,' no doubt, notwithstanding the expense, be admitted to have been a judicious-step taken. The compulsory payments, under the Fire Brigades Act :in New Zealand have formed an appreciable, addition under ..the heading of additional ■ expenses. In this latter connection I might:mention'-that our contributions under :the. New Zealand Act range--from 6 per cent.'to 19 per cent, of our fire income in the districts in wllich;fire boards exist. These fire brigade charges' are, therefore,' a very serious chargo upon our business, and the time,is not far'distant when there must be a readjustment of rates, to meet these charges. The underwriting profit is .£14,768, being 4.64 per cent., against 6.91 per cent, for the previous year; Adding the. net' balance brought forward from last, year to the amount at the' credit of- the revenue Account, the amount standing at the credit of profit and loss is .£63,539. The' directors have transferred .£IO,OOO to ; the reserve fund, and after raying the interim dividend in April last,-making provision, for the leasehold sinking fund, and Writing nil office furniture, and for the appropriation to the staff superannuation funds, .there''is. a .balance -left, of '515, out of which the directors recommend the payment of a dividend of Is; 6d. per share, making tho 'dividend for the year 3s. per share, and. leaVing .£19,515 to-be carried forward." .

.After' further explaining "the finanoial position,'.the chairman said: - "As an indication of the unsatisfactory, nature, of,, fire' business in Now, Zealand, I may mention -that tho -losses paid by .companies, doirlt? "business in. tho'Dominion. have in - the Canterbury • Provincial District alone amounted to the. unprecedented sum of <£356,000 for the year ended August'3l last, near upon jCIOOO a day for one single district. Fire'losses were also severe throughout the rest of Js T ew. Zealand, and'l believe that I am-not far out when I-estimato-the'trading loss this year 'to the whole of the- companies on .their New Zealand- business at anything from .£200,000 • upwards." The report was; adopted, and Messrs.' J. Edson and AY..1?.. Wilson were re-elected directors. ; The . chairman, returning thanks 011 behalf of himself' and the board of'directors, re« marked that they had. had tacked'upon them legislation which was disastrous in. the last decree so far as their business -was -concerned; in other industrial enterprises tho feeling- was just. tho same. Tho profits brought into- New Zealand.-through ' insurance . companies were greator than from ' anyv other source, except tho i products of the soil. '