Hawke's Bay Times. Nullius addictus jurare in verba magistri WEDNESDAY, MARCH 6, 1872.

Hawke's Bay Times, Volume 19, Issue 1266, 6 March 1872, Page 2

Hawke's Bay Times. Nullius addictus jurare in verba magistri WEDNESDAY, MARCH 6, 1872.

The efforts of the New Zealand Government to foster habits of prudent foresight amongst the people are being rewarded with a considerable measure of success. Its scheme of life assurance has not only called the attention of many to the question, who, but for that scheme, would not have troubled themselves in the matter, but it has also expited the managers of rival associations £q increased activity, so that life assurance lias become one of the interesting topics of the day, This being the case, ajid the importance of the subject being acknowledged, it becomes a question of no little cqn-equence to intending assurers, whether the scheme of the

Colonial Government- offers as great or greater advantages to the investor as or beyond those offered by merely commercial speculations, whether proprietory or mutual; because, other things being equal, an investor will not prefer the scheme of the Government simply because it is a Government scheme, but will seek for that one which offers him commercially the greatest eood. Of the two classes of private schemes the mutual appears to be the best for the assurer, because it is abundantly obvious thyt the aim of j capitalists in the proprietary companies j is a good return for their investment, and the terms they offer must be consistent with this view, with this limitation—they find it to their account to make the premiums as low as is consistent with it as an inducement to assurers; bub, as a matter of fact, a profit on the investment of their capital is the main object contemplated, The mutual companies have the disadvantage of no capital apart from the investments of the assured. The capital is in fact comprised in these investments. Higher premiums are necessitated on this account, but as these premiums are regarded as invested capital, it i s not considered a disadvantage, the profit accruing from them being (with some limitations) divided amongst the assured. There is one great drawback to all the scheme- comprised in both these classes of insurance companies—the large pro-: portion of the premiums swallowed up by ccht of management. A love of display induces the erection or rental of costly offices; managers and officials are highly salaried ; the inducement offered to canvassers in the bonuses given on business done; and a multiplicity of other expenses connected with pushing and carrying on the business, fall heavily on the assured, and lend to prevent multitudes from effecting life assurance. There is also an element of uncertainty to be brought into account. Many companies offer the inducement of low premiums to tempt the assurer, and the amount of premium demanded is one very important element in the calculations of persons entering into these arrangements; but it frequently happens that after a run of some years these companies collapse, and leave the assured when old. after having made many payments, losers of the expected bene fit, and without remedy. The temptation to such a course during the early years of such a company's career is very great. Capital is flowing in abundantly, the calls on account of deaths are few, and enormous profits or remarkably low premiums are pointed at as proofs of success, and inducements to join them. After a course of years, all this is changed. The claims accumulate; there are no profits to be divided ; and the very existence of the company depends on the adhesion of new and young members.

Few, if any, such drawbacks attach to the Government scheme. No offices are needed, expensive or otherwise; few agents are required, because in the postal department of the Colony both offices and a complete staff of agents already exist, No profit is sought—the object of the Government being to promote habits of providence in* the community; and the security offered far fulfilling obligations is such as no opposing company can approach, being nothing short of the colonial revenue itself, Assurers are confident of the fulfilment of obligations by the Government, unless there be a total collapse of the Colony, and all its, obligations be alike repudiated.

Besides the advantages already enumerated, the Government offers others which it is out of the power of rival companies to offer. These are—(l) exemption (up to a certain sum) from the operation of the Bankruptcy Act. A person who has paid premiums for years, perhaps hardly saved out of daily earnings, may find himself in old age overtaken by misfortune, and forced to bankruptcy. In ordinary cases his creditors would have a claim on the insurance premiums. Under the Government plan, the fruit of previous prudence is secured to him or his representatives (2) A married woman may effect policies, and the.se are free from the control or debts of her husband. (3) Endowments for wife or children may in like manner be secured during pei iods of prosperity, and such become the bond fide property of the wife or children so benefited, free from the claim* of creditors, and unaffected by subsequent misfortune or reverses. Another consideration which may weigh with some is that the ordinary revenue of the Government is benefited by the business done in this way. The premiums paid by the assured are so much capital placed in the hands of the Government, and invested in their own securities, the profits being directly applied to the benefit of the assured instead of the capitalist, or of forming a necessary contingent fund, as the case in other assurance schemes.