UNION INSURANCE COMPANY.

Globe, Volume XXII, Issue 1988, 8 July 1880, Page 4

UNION INSURANCE COMPANY.

The third annual meeting of the shareholders of tho Union Fire and Marine Insur- j aaoe Oompuny of New Zealand wai held at the Head Offices, Hereford street, yesterday at noon. There was a good number of shareholders present, the Hon. J. X. Peacock occupying the chair. The annual report and balance-sheet were as follows : , . Tear directors have again the pleasure of presenting tho annual report and balance-sheet of the company. Notwithstanding increased competition, reduced rates of premium, and, in the earlier part of the year, nnprecedentedly heavy losses, the result shown will, they believe, prove satisfactory to the shareholders. It will be seen from the balance-sheet that after providing for all losses and expenditure, and after setting aside .£2900 as an appropriation fcr unadjusted losses, there remains an available balance of £18,053 10s Id. This balance the directors recommend zo be dealt with as follows : To payment of a, dividend at the rate of 10 per cent. .... ... £7500 0 0 To reserve fund (which will then stand at £25,000) ... .... 5000 0 0 Leaving a balance to be carried forward to next year of ... 5558 16 1 £18,058 16 1 It will be noted that the premium income of the company is still progressing, notwithstanding that the directors have declined a very large amount of business rather than accept it at rates deemed by them to be unremunerative. They propose to continue their present conservative policy, feeling convinced that it iB the course best calculated to enable them to present from time to time reports showing satisfactory results like the present. max It is with deep regret the directors allude to the death of their late esteemed colleague Mr T. M. Hassal, a gentleman who, from the time of tho first conception of the company until Jub death, took a most active interest in its One'of your auditors. Mr E. S. Barley, having resigned his position during the year, the directors appointed Mr A. M. OUivier to act in his place. .„ , It will devolve on the meeting to nil two vacancies on the Board, one caused by the death of the late T. M. Hassal. Esq., and the other by the retirement by rotation of Joseph Palmer, Esq., who is eligible for re-election. Messrs Joseph Palmer and P. Cunningham are the only candidates nominated for the vacancies. It will be necessary to elect auditors in place of Messrs P. E. Wright and A. M. OUivier, who retire, but are eligible for reelection. The dividend, if sanctioned by the shareholders, will he payable at the Head Office immediately after the meeting, and at the branches on receipt of advice. . J. T. Peacock, Chairman. Christchurch, June 29th, 1889. Pbofit and Loss Account, May 31st, 1880. £ s. d. £ s. d. To fire and Marine Losses ... 31,765 18 9 Less proportion of amount appropriated last year for Unadjusted bosses 2,000 0 0 Jg g „ Fire and Marine Be -insurances. Discounts, and Beturn Premiums ... 35,861 3 3 LeBS proportion of amount appropriated last year for Be-in-surances unpaid 3,000 0 0 e . 32,861 3 3 „ Stationery ... 577 5 5 „ Agents'. Commission, Expenses of Management, and Sundry Charges 17,658 5 5 „ Amount written off Premises and Furniture „.„ «. „ Account ... 545 14 7 „ Appropri at i o n for Unad justed Loaves... ... 2,900 0 0 „ Balance ... 18,058 16 1 £102,367 3 6 £ B. d. By Balance from 31st May,1879 (after payment of Dividend and Appropriation to Beserve Fund) 4,124 17 10 „ Firo and Marine Premiums 91,182 19 8 „ Interest Account 7,019 8 6 „ Transfer Fees 39 17 9 .£102,367 3 6 . . Balangb Sheet, liabilities. £ a d Capital Account, 100,000 Shares, at 15s paid up 75,000 0 0 BeserveFund 20,000 0 0 Unclaimed Dividends ... ... 11" 2 b Calls in Advance Account _ ... 63 15 0 Appropriation for Unadjusted Liases 2.900 0 0 Balance to Profit and Loss ... 18,058 16 1 £116,139 13 7 ASSETS. Mortgages 56,423 10 0 Deposits bearing interest ... 33,500 0 0 Premises Account 6,731 3 0 Furniture Account 1,350 0 0 Calls Unpaid 27 10 0 Amounts owing to the Company at Head Office and Branches 8,284 12 4 Cash in Bank and on hand at Head Office and Branches ... 9,822 18 3 jei16,139 13 7 We have examined the above Balance Sheet and Profit and Loss Account, together with the vouchers, accounts, the books of tho Company, and securities, and heraby certify that the above is a correct statement of the affairs of the Company. F. E. Weight I Auditors A. Morton Ollitibb J AU(UMrB - Christchurch, June 29th, 1880. ?&*■* Chairman said : Gentlemen, moving tho adoption of the third annual report and balanoo-sheet, I desire t) offer a few remarks on the doings of the company during tho period since I hist had the pleasure of addressing you. The premiums, as you will see, have increased, and tlough the amount of the increase has not been very large, still that is owing entirely to the action of the directors, who made up thtir minds to accept business only at rates they consider payable. Competition has been very keen in New Zealand, and in some places there has been a perfect scramble for business. In this we have not joined. Had we done so, the balance-sheet now presented might have shown a loss instead of the present »«ult. T ■will now touoh upon tho item undor the head of Be-insuranoe, and I do this more especially as I understand some shareholders consider we have paid away too much for this purpose. The directors have no reason to regret this expenditure, and without going into detail, when I tell you that in one instance we recovered o?er £BOOO on account of a loss, shareholders will at once see there is a great deal of reeson in this precaution. This leads on to the item of-general expenses of management, which have been heavier than previously. It is a subject the Directors have had before them constantly, and every effort is made to keep t'iem as low as possible without impairing the efficiency. The total was considerably swelled by a law suit at Sydney with the gentlemsn who formerly occupied the position of the company's agent there. The Directors after eighteen months' trial, finding the working at Sydney was very unsatisfactory, decided to establish a branch and discontinue the agency. On this being communicated to the late agent, he commenced an action for £3OOO damages, the result of the trial was that the jury awarded no special damages, fant gave a verdict for £235, in accordance with the Judge's direction. Although the discontinuance of tho agenoy cost a very conoiderablo sum for legal and other charges in addition to tho above, we think the change has been beneficial. We have now our own manager, and havo also been fortunate enough to aecuro the eorvices of a gentleman holding a leading position in mercantile circles as a local director. Having the reduotion of expenses in view, the directors have decided to close the branch office in Wellington, and conduct the business thero through an agency. After P' & three-years' trial, we find that the amount , of business done does not justify the expenditure. I now, with feelings of deep regret, s?.«A}f>roach that paragraph in the report whioh tanidcii to tho death of our late esteemed „j< Mr T. M. Hassal. Those of ub o" had the advantage of his valuable ' & the Board best know of the loss y s€stfin*d*by the company through his decease, ■ who had the pleasure of his ao/tg£ajjilisneo*can remember his ready ability >Q njpaner, and deplore his abienoe %r After due consideration >„£> ffie < *$jisgct4fr£ , d£tormined to invite Mr P. ? (^Boitd.^^ft*'!*as6tleman) however, whilst x, same, preferred leaving £\ols3 e&dSrqr? JRS. meeting, and himself as a

candidate. No other gentleman having been nominated in opposition leads the directors to take this as an indication that the selection made by them is one that has given satisfaction to the shareholders, and they feel will give strength to tho Board. The shareholders will see from the aocounts that the assets of the company show very satisfactory figures. There is one item upon which I may perhaps remark, and that is the amount appearing as deposit*. The direotors propose to keep at all times suoh a sum of money at command as will enable them to meet any emergency should one arise. The amount, however, is at present somewhat larger than they consider necessary, but this is caused by tho fact that for some time past satisfactory securities have not offered, and a portion of the deposit is at actual call, awaiting an opportunity for investment. It will be remembered that last year I referred to the question of calls, and then stated that possibly no more would be necessary, at all events for the present. I am glad to say that the results of last year's busineas bas confirmed the opinion then expressed. There is one matter upon which I havo boen questioned,and that is, whether or not the company would declare interim dividends in future. Tho directors havo no power to pay such dividends, nor do they propose at present to ask for such, feeling that the company being as yot in its infancy should, until it acquires, a position by large accumulated reserves, refrain lrom anticipating profits which might not be earned. In conclusion I will refer to the recommendations contained in the report, whioh are that £7500 be paid in dividends, £SOOO carried to the reserve fund, and the balance carried forward. It must be gratifying to you to find that notwithstanding a trying year the directors have been able to augment the reserve fund by a substantial amount, and pay a satiefaotory dividend. If the recommendations are approved, as I believe they will be, we shall during the two years and nine months of our existence have paid away in dividends £13,725, placed to reserve £25,000, and hold in hand £5558 16s Id, a result whioh cannot but be considered highly satisfactory, and whilst not desiring to draw comparisons, I think will show favorably when compared with recent statements of similar institutions in this country. If any gentleman desires any further information I shall be only too glad to givo it. I now beg to move the adoption of the report and balancesheet. Mr Murray-Aynsley seconded the motion, and took occasion to remark that when considering the disastrous season for marine risks they had lately passed through, the result of the past year's operations must be regarded as being eminently satisfactory. Ho referred to the profit shown in the report, and viewed with satisfaction the steady and increasing reserve whioh the directors had been able to provide for future years. With regard to reinsurances, he strongly approved of the policy pursued, which was absolutely necessary in carrying on such a business as was done by this company. Mr Cowlishaw asked the ohairman what rate of interest tho deposits were bearing. He would also tako advantage cf tho opportunity to make a few remarks on report. On the whole the statement was fairly satisfactory; at the same time he thought it indicated to some extent the feeling pretty generally felt, that the company was rather too conservative in character. If the figures were analysed, it would be found that tho amount of profit realised was not so very considerable, being somothing like £7OOO. Tho figures showed the profit as £18,000; but of that the sum of £4OOO was brought forward from last year, and £7OOO odd had been set aside for interest on their capital, whioh left about £7OOO profit m the year's transactions. He was not sufficiently acquainted with the business to know whether the item of £32,000 was necessary, but it struck him as being a very large proportion in consideration of the actual amount of business done. On tho whole, however, he acknowledged that the accounts were very satisfactory. 1 Tho Chairman, in reply to tho question asked by Mr Cowlishaw, said that tho rate of | interest on fixed deposits was from six to seven . and a half per cent, and the whole of the money in deposits and investments would produce an average of about eight and a quarter per oent. Mr Nathan said he should scarcely like the ) opinion of Mr Cowlishaw to go forth unchal- | lenged, as an expression of the opinion of the 3 shareholders. In all probability the directors ' were liable to be influenced by any expression " of opinion at an annual general meeting, and hence he considered it incumbent upon himself, as a shareholder, to record his own conviction that the company was not by any ] means too conservative in the conduot of its business. On the contrary, ho was of opinion ) that the result of the year's operations would 3 have been of a different character, and nothing 5 like so favorable, had the company been less ■* conservative in character, and this, he said, , knowing the great depression that had preI vailed during the past twelve months, and the . effect thereof upon insurance business genej rally in the colony. Indeed he felt that, considering the period they had passed ) through, the faofc of their being able ) to show such a balance sheet as ) that before them was a matter upon which ) the shareholders might heartily congratulate 3 themselves. When times improved he hoped to see still larger profits, but in the meantime he thought the shareholders had good reason , to be satisfied, and he thought it would be . unwise to allow such an expression as that ho j referred to to go forth unchallenged. t The Ohairman expressed the'gratification he j felt at the remarks whioh had fallen from the , last speaker, indicating confidence in tho 3 judgment of the directorate. At the same 3 time he might say that he did not think the remarks of Mr Cowlishaw would have influenced the Directors. It would require an express resolution of that meeting to do so, and possibly it would be 1 found that it would be necessary to ap- ' point new direotors to alter the policy of the k company. They felt firmly convinoed of the security and certainty of the conservative ' policy, and would not feel inclined to alter ' it unices absolutely directed to do so. ' Mr Cowlishaw spoke further on the subject, remarking that from the accounts it appeared that it required £20,000 of expenditure to make a profit of £SOOO. On the motion of Mr Cowlishaw, seoonded 1 by Mr W. D. Wood, Messrs J. Palmer and P. ' Cunningham were appointed directors. 1 Apologies for absence were made on behalf ' of Messrs Palmer, Btudholme, and Mont- ! gomery. Mr Anderson propooecl tha l-fl.appointment of Messrs F. E. Wright and A. Morton ' OUivier as auditors. Seconded by Mr Harley and carried. Mr Stead proposed a vote of thanks to Mr 1 W. D. Meares, the general manager of the company, and officers of tho oompany. In - doing bo he remarked that the success of the I company was largely due to the general manager, whose great ability and energy were 1 well known. In reference to what had fallen i from Mr Cowlishaw, he pointed out that had ' the business not been conducted on the 1 principle whioh had characterised it, thore ' would possibly huve been no profits, and the ' cost of management would have bean the same ; and with regard to the question of ro--1 insurance, their manager had given to this 1 matter the fullest consideration, and his ex--1 tensive knowledge rendered him peculiarly ' qualified to deal with it. The vote of thanks to Mr Meares was 1 carried by acclamation. ' Mr Meares made a suitable response on ' behalf of himself and tho oiTcara of the 1 company. > On the motion of Mr L. Harper, a voto of 1 thanks was passed to the directors. This concluded the business. i ■ '