Page 2 Advertisements Column 1

Feilding Star, Volume VII, Issue 131, 15 April 1886, Page 2

The New Zealand Government Life Insurance Association. Misleading Compabison. 'I 'HE Iquitable Insurance Society of I the United States has published a statement comparing the costs of new l.usin.ss with the New Premiums re» ceived. The Public ar» warned against accepting the comparison as a statement showing the true cost of the business. It is Misleading because the New Premiums of the Iquitable are mostly Annual, while those of the Government Insurance Association are chiefly Quarterly and Monthly. The New Premiums of the Government for 1884 represent in (£10,387) annual premiums £24,073. According to the summary of the business of Australian Life Offices, published by the Australasian Insurance and Banking Record, in the number for January, 1886 (page 39, fourth column from end) the New Buiiness of the Government Insurance Association was acquired at a less cost than any other Australasian; Office. A study of the third ftnd fourth columns (from end) of the summary just ] mentioned will speedily expose the Fallacy of the Equitable method of com- j paring the cost of the new business. The Equitable comparison, moreover, does not allude to the commission paid for collecting the renewal premiums. The amount expended by the Equitable during 1884 for collecting £1,698,776 of renewals was £100,812, or nearly Six Per Cent (Government slightly over Two Per Cent). The method of comparison adopted by the Government Insurance Association is aot misleading, because both offices value by a method which makes no allewance for the heavier cost of new business. The Equitable spend nearly Twenty Per Cent of their total premium income on the Management, while the Government expenses are but slightly over sixteen per cent. The Lapsed Policies of the Equitable during the jear 1884 amounted to nearly One-fifth of the Insurances in force. The Lapsed Policies of the Government Insurance Association for the year 1885 amounted to less than One-tenth of the Insurances in force. FURTHER FALLACIES EXPOSED The comparison made by the Kquitable <»f Surrenders to New Premiums is farfetched and absurd, as even the veriest tyro in Insurance matters is aware. Emanating from the Equitable as an official production it is inexcusable on the ground of ignorance. The Equitable ought to be aware that the cash value of a policy is not merely One Instalment of a premium, but that it is a propertion of the whole of the premiums paid. It would be equally as absurd to compare the claims with new premiums. The amount paid for surrenders repre* sents in Annual Premiums on new policies issued during 1884, £4024. The annual premiums on new policies issued during 1884 amounted to £24,073. 1 his is totally different to what the Equitable would fain make the public believe. Ihe Kqui table have at last been compelled to admit that they have been misleading the public, and that nearly oae fifth of their so called new business for tke year may be designated " bogus," not a sixpence of premiums having been received, a policy having been issued for every proposal received, whether the premium was paid or not— a method adopted by no Australasian Office. The statement that the Government Insurance Association substituted an opinion tor the real opinion of tke " Australia* Insurance and Banking Record', is not true. In the first place, it was not an opinion at all that was quoted ; it was merely a statement ef Facts. In V c second place, it was believed that such a reputable journal would not publish such ft statement without being duly satisfied that it was authentic. The usual pre* caution was taken of shewing the au thority by printing the words "Vide 'Australian Insurance and Banking Record* for January 1884." Had that course not been adopted, the Government Insurance Association would have been charged with publishing anonymous attacks. We have said it was a statement of fncts, and we repeat that "The Equitable has a Tontine, but, stated in Court, in the case of 'tfewley' v. The ' Equitable,' that all the funds beleng tn the stockholders of that ( orporation, and that the policyholders had nothing to say in the matter of their disposal." Then, as to " The Citizen" quotation. It was not taken directly from that publication. It was extracted from a pamphlet circ«lated by the Equitable, and bearing the names of the Society and of the Manager. The question was merely as to the investments; and the fact that we stated that " the Citisen" was generally "favourable to the Equitable,' supports this. As relating to the nature of Equitable investments, it was deemed advisable to emphasise the sentence. The Equitable acouses the Government of omitting a part of the context, and yet in an official advertisement published in the Lyttleton Times of the 16th February, 1886, the Equitable, in correcting the said omnsion, themsel ves carefully left out a portion of the context. We now reprint the sentence, capitalising the words omitted by the Equitable : — " The Equitable itself admits that on account of the greater difficulty of securing remunerative returns on investments, there will not be so large profits in time te come ; nevertheless, the b*nuses are certain to be enormous, and those effecting such policies. And Keeping Thkh Up to the End, will not be disappointed." What hidden meaning in those words, "and keeping them up to the end !" The law-suits quoted were against offices that bad the same conditions in their policieic as the Equitable, notwithstanding all that has been said, the fact remains that Death Through Violation of the Law is sufficient to render an Equita able policy void. The Equitable state that they have never Contested a claim, meaning that they have never gone to law over a claim, and they desire the public to aemme that the Government have done se. Tue Government have never contested a claim. lUmbtlev* liie Equitable, like all other offices, have received unjust claims that have not been paid. It would be a mis* appropriation of the Policeholders' money for an office to pay evrry c'aim, irrespective of <>» Legality or Justice (as for example th Howard case in Christchurch). No reputable effice would do such a thing, nml it is presumed that this a] ]x-l atici: is .ipplical le to the Equitable. FURTHER FACTS. The aveniLe rate of interest on invest ni'"n«> obtained by the Government during }bt<4 viii' higher th-n that obtamed Im tiie Kquimhle. The Go 'eminent rale is ri-iii«. while that of the Equitable is in* ling. Ihts Actual Results of the Tontine