CITY'S FIRE RISKS.

Dominion, Volume 6, Issue 1782, 21 June 1913, Page 6

CITY'S FIRE RISKS.

6 \ DEBATE RESUMED. ■\ THE COUNCIL'S DECISION. TENDERS TO BE CALLED. AVERAGE CLAUSE &c. TO GO. < Insurance matters occupied the' attention of file City Council at the adjourned meeting yesterday afternoon. Tho Mayor (Mir. J. P. Luke) presided. Others present we\re Councillors E. Tregear, J. Godber, E. Fletcher, W. J. Thompson, H. Buddie, M. F. Luokie, J. Fuller, A. H. Hindmarst, L. M'Kenzie, T. A. C. Hislop, R. A. Wright, and W. H. P. Barber, and G. Frost. The debate centred on an amendment by Councillor 'Hind-marsh. This was to the offect that Ml© offer of Messrs. SeadGowing and Craven, Ltd., to obtain an insuranco policy over the Wellington City Council's property bo accepted. Discussion was resumed by Councillor M'Kenzie, who was on his feet when the council adjourned on Thursday night. He proceeded to state that Lloyd's, who were said to be backing that firm, was not an incorporated body, and waa also a body wjiicli sold its insurance stock. During the'last ten years the counoil had paid about i£6ooo in premiums, so that the insurance companies were holding a very good risk. He advocated holding back for three months in order that the officers of the council could mako a thorough investigation of the proposal. The people making it were, in his opinion, entitled to just as much, consideration as any other set of underwriters,, but they must be quite sure of their stability. Councillor Bnddle followed. Ho thought that the matter .should be decided on one point—what was best in the interests of the >it 3*. In tho past, the insurance companies had not given the council a fair hearing, and there was a certain amount of indebtedness due to Sead-Gowing and Co., for bringing tho matter up. The whole thing had been handled wrongly from the start. They should have listened to the offer, and then asked the other companies to tender. He wai of opinion 'that further consideration by the City Council should stand over for three months. If that interval were given full inquiry could be made into the stability of Sead-Gowing and Co. They had an offer of a 10 per cent, reduction, but he was not prepared to say that the other companies would not give a similar reduction. He strongly advised tendering on a prepared schedule.

What is Lloyd's? . Obuncillou M. T. Luckio pointed l out that the stability of Sead-Gowing and Co. was not the point at all. They would not bear tho responsibility. Thoy wero only brokers, who were offering a policy from a foreign company, of whose affairs they knew little or nothing—a company which was not operating 'in New Zealand, and had not complied with tho provisions of the Foreign Insuranco Companies Deposit Act of 1891. That Act provided that a company must hold a certificate issued by the Public Trustee, whose duty it was to inquire into tho stability of all companies who proposed to operate in New Zealand. The speaker also pointed out that with Lloyd's they would not have the right to sue or be sued. If under the terms of the proposal they had to tako out a policy with Lloyd's, he was strongly against it. Bvery Lloyd's policy had a number of names on tho back, and if any of those firms "went 'broke," the council would have to submit to a proportionate reduotion. Tho matter should bo postponed until they had fuller information.

Councillor Fletcher said that the whole matter had been blundered from the first. He believed that every company should be allowed to tender on a sohedule, and they should have given th© oompany who was holding the risk an opportunity of tendering. This had not been done.. A fair chance should be given , to all companies in New Zealand to accept the council's cover. Councillor Barber said that supposing the brokers had not submitted the 10 per cent, reduction, what would have been the- action of the local underwriters? Councillor M'Kenzie: "They would have enforced the average clause. Councillor Barber said that they had an offer which would cut down their premium by <£60. If they looked at the matter from a business point of .view, and without any sentiment, they must consider it. Assuming that it was other than insurance, what action would any ono of them take? As time was to short (the policies. lapse on Juno 24) he supported tho motion that more time be given to make inquiries. Had they, como to a conclusion the previous night they might have had time to make the necessary inquiries, 'tfut tho loss of time which had elapsed had made that almost impossible, particularly as Monday next was a holiday. In the-Dark, Councillor Hislop said that the substantial question was whether they were to Temove their policy from a company with which they had been doing business for years, and give it to one about whoso credentials they were in the dark, As the result of his inquiries, he had found that there was an insurance combination, but there was no evil in a combino when it was not used' to' impose extortionate premiums out of the public, and an inquiry into the premiums paid on England and Australia, they would find that they were not being uniairly treated, He also pointed out that 75 per cent, of tho shares of local companies wero held in the country.-

Councillor Tregear stated that it did not matter to him whether lio was robbed by a man in London or a man on Lambton Quay. Ho was instinctively against all combines, and when another company came along, and offered to give the city the risk at a less rate, ho thought that it should be accepted if the offer was a sound one. Councillor Puller remarked that ho was very glad that the matter had been thrashed out in the open—all councillors would■' agree with that. He was sorry that there had not been time to make it possible ■to carry the amendment through. The council was indebted to Councillor Hindmarsh for the action he had t-aken. Councillor Frost advocated the three months' adjournment, and referred to Councillor Hindmarsh's speech of the previous evening as "a lot of piffle." Councillor Hindmarsh said that he had been misunderstood. All ho said was "We accept your offer, if you come up to scratch—that's all it meant." Councillor Wright pointed out the inconsistencies in the speeches of councillors and made referenco to Councillor Puller, who, he said, had jumped "Jim Crow," and Councillor Hindmarsh who had said that there was only one company operating in . New Zealand until lie discovered the State Fire office, which he said had not succeeded in breaking the He expressed astonishment at councillors' amazing inconsistencies.

Censures Councillors. The Mayor said that he resented tho imputation that tho Finance Committee had not conducted tho matter in a proper manner, and ho traced tho wholo of tho business from his first interview with Mr. Braund. Finally, ho invited all the councillors, in open council, to {ittend in his room, and meet, tho underwriters, tat not a single councillor had attended. This was an act of discourtesy towards the Mayor. (Sounds of protest.) Tlio invitation was issued from tlio chair in open council. Somo might not have heard it, or they might havo been out of the room. Still lie had asked them to meet tho underwriters in his room, and no one had turned up. Much had been said .about "not holding a brief for this and that," but he was not saying anything about a brief. lie was thero to do his best in tho interest of tho city. Theso gentlemen camo along and offered a 10 per cent, reduction and to eliminate two distinctly objectionablo clauses. Ho thought that councillors had failed to rise to a higher senso of their duties tho previous night, and now timo was short, fly aocantLtif? tho nmoml-

and through councillors not having rison to the occasion tlioy had now (o adjourn tho whole thing for three months. Tho Mayor then put Iho amendment (moved by Councillor Hindmarsh and seconded by Councillor Fitzgerald):— "That tho Wellington City Council accept tho offer of Messrs. Sead-Gow-ing, and Graven. Ltd., to obtain an insurance policy over the Wellington City Council's property, provided that tho executive are satisfied with tho policj*, and tho solvency of those behind it." Tho mover's voice was tho only "Aye," as against a chorus of "Noes." "Divide!" said Councillor llindmaTsh. Tho division still found Councillor Hindmarsh lonesome. Tho resolution (moved by Connoillor Frost in committee) was 'then put, and carried without a dissentient voice. The precise wording of tho resolution was as follows:—"That tho council obtain a cover for three months from some company, and that, in the meantime, tho Town Clerk draw up a schedule providing for the deletion of the average clause and other warranties now imposed, and that tenders bo invited foT the-insurance."