INSURANCE COMPANIES.

Evening Star, Volume VIII, Issue 2127, 1 March 1870, Page 2

INSURANCE COMPANIES.

To the Editor of the Evening Mar. In the Times leader of the 24th hist., Mr Julius Vogel’s Government Annuity and Life Assurance project is very fully canvassed ; but from the very limited experience I possess in insurance matters, it .appears to me that a very one-sided view of the case hn*f been taken, a strong bias exhibited in favor of the Government, and grievous injustice done to public insurance companies, many of which are at present doing a large and steady lit© business in Dunedin. I do not intend to treat the article analytically, I merely desire to correct a few impressions conveyed by it. The editor of the Daily Times indulges in many axoims and truisms which cannot be contradicted, but which in the form there presented to the public are calculated to cart a decided and in discriminating slur on all insurance companies. Qf course, there is no disputing the fact that the whole value of a life policy consists in the stability of the office issuing it. The index of that stability however, as laid down by the Times is, in my opinion, false. I think with respect to the safety of an insurance more is to be gained by one glance at the names forming the directory than by the most careful study of the accounts concocted and issued by that directory for the enlightenment or misguidance of the public. With an unprincipled Board of directors, how much reliance, I would ask, can be placed on any statement of liabilities, even supposing the assets to bo correctly estimated. Life liabilities are matters of such complicated and laborious investigation, that it would bo impossible for any but an actuary to check their correctness, even supposing tho books of the company were open to public scrutiny. The amount of these liabilities * has to be taken on credit by the public f nm the hands of an ofttimes unscrupulous directory, and yet the Dally Times informs us that the true criterion of the stability of a company is to be discovered by an overhauling of its published accounts, and comparing the assets, which are real and palp ible, with the liabilities, which are subjects of calculation, and very often valued at an altogether fictitious figure. How much information would int nding insurers have gained by a careful investigation of the balance-sheet of such a company as the Albert ? This company is mentioned by the editor of the 'Times as if it were on a par with the general run of insurance offices now in existence. People out here are not well posted up in insurance matters, so are likely to be prejudiced against all companies in

consequence of the failure of one. The Albert Insurance Company, however, has for many years past held such a questionable name at Home, that no one ever thought of insuring in it if he had the smallest chance of being accepted by another office. It was proverbial for doing a very risky and hazardous business ; it advertised that it accepted invalid lives, and transacted a very large East India business (at all times a very doubtful class of lives). By the news just received it appears that, after all, the insurers in the Albert will not be losers by the winding up of the office, as its business is now to be carried on by the Mutual Insurance Company. When an office goes to the wall at home, it generally happens nowadays that the insurers are not the sufferers, as a similar arrangement to the above is almost invariably made. But there is another side to this question. The Albert is one of a small class of offices. Another more numerous class comprise s those whose policies are looked upon as being equal in value to even Government ones. There are many such doing business at the present day in New Zealand, and it is my opinion that these companies will always command a fair proportion of public patronage. I would write more on this subject, but I fear I have already encroached too largely on your space. I would wish to point out how none of the special advantages offered by the Government differ materially from the ordinary practice of Home offices: and how the inducement held out for the assurance of the lives of minors would be actually pernicious in its results. Time will prove whether post-office officials are calculated to make good insurance clerks and actuaries, and likewise whether the people of New Zealand will ever be induced to sink their capital in the purchase of annuities. The tables must bo based on a high rate of interest if the Colonial Treasurer expects to obtain a fair list of annuitants, and as it is a moral certainty that in a few years money will be cheaper than it is at present, the Government will then find that the annuities they have gra ited will turn out a very losing speculation. Thanking you for your kindness in inserting the above—l am, etc., ° TO