Fire Insurance

Feilding Star, Volume IV, Issue 9, 30 June 1883, Page 2

Fire Insurance

The agitation among insurers, upon the good results of which so many built hopes of a considerable reduction in current rates, is not >ikely, for some time at least, to do any good to settlers south of the Rangitikei River. We learn that the various managers in Wellington have decided to maintain the present high rates until most of their current policies are due, when they will renew at lower rates, to prevent any office which may withdraw from the •*' unholy alliance" getting the business. We must admit thai as most Insurance Companies are managed, it can only be expected that high premiums must be charged in order to keep up dividends. The business of insurance is the only one where competition is not the soul of trade, and the cause of reduction in prices to customers. The reason of this is that when Insurance Companies are active in their canvass for business, the working expenses are increased enormously. The salaries paid to the officers in head offices, or where local managers are appointed, are not large, or in any way in excess of what may be considered fair remuneration for a specially qualified class of men. It is in the agents' commission, which is always 20 per cent, on premiums collected, in extravagance with gorgeous and expensive stationery, in the gratuitous issue of ridiculous articles with the name, &c, of the company emblazoned on it as a catchpenny, and expensively erected places of business. The policy holders have to pay for this, because when each company finds its expenses increasing out of proportion with the increase of new business, the only way to enable dividends to be paid to shareholders without encroaching on capital is by increasing the charges to insurers. The best plan to crush the monopoly is for the Government to undertake fire risks as well as Life Insurance. This would definitely sp-tle the question.