POWER BOARD RISKS.

Shannon News, 26 March 1929, Page 3

POWER BOARD RISKS.

SHOULD THEY BE SELF-BOURNE,

MOTION FOR ALL-INCLUSIVE IS'CHEME REJECTED.

MODIFIED PROPOSAL FOR NEXT

MEETING.

The motion Dy Mr T. G. Vincent; that the Horowhenua Power Board establish its own fund . of insurance against public risk, accident, and damage to vehicles, consideration of winch was' begun at the February meeting of the Board, was further discussed on Tuesday, but on being put to the vote it was lost. The mover stated that the Palmerston North Borough Council had been carrying half their own risk for some years, and now had over £2OOO in the reserve fund, while notice had been given of a motion that the Council take over the wlyde of its insurance.

ATTITUDES OF OTHER BOARDS. The secretary (Mr P. W. Goldsmith) reported having reecivcd replies from eleven Power Boards to inquiries as to what they had done or were proposing to do in this respect. He proceeded to summarise the information thus obtained, the points of which aro given below: — South Ganterbuiy.—This Board has given the matter careful consideration, and is taking a cheap method to insure buildings, stores, vehicles, etc., with one company. Southland.—The Board lias not established its own insurance fund, nor is it considering taking such a step in the near future. Its insurance is confined to fire, accident and public risk. It does not carry a comprehensive mo tor risk policy. Wairarapa.—The Board has not yet established, own insurance: fund. It is its intention to set aside each year a- sum to form the uucleus,.of an. insurance'fund, so that when "it decides to take such action it will have a reasonable fund to meet any extraordinary loss which it might experience in the first year. Dannevirke. —Up to the present this Board has not established, nor. has .it considered, a scheme for taking its own insurance‘covers. Wanganui-Rangitjkei. The Board has not established an insurance fund, and is not considering such a stcp\at present. Thames Valley.—The Board in its early stages considered this matter, and has no intention whatever of establishing its own insurance fund. If this had been done in the initial stage of the Board, it would have been a very heavy loser, owing to the number of accidents in the interval.

Manawatu-Oroua. —This Board has not established its own fund in connection with insurances. As to the future, the matter has not been considered, but the secretary does not think that the question of the Board taking its own accident insurance risk would be' entertained.

Otago —The Board lias not established funds under the amended Act nor considered such a step in the near future Its insurance business is carried on at present by one of the insurance companies * Waitemata—This Board has not established any such fund, and-so far has not given any consideration to the matter. The secretary would like to know, when* the Ilorowhenua Board has collected the necessary data, what steps the other Boards have taken. Hutt Valley—The (Board has not considered the establishment of an insurance fund. v

Central (Hamilton). —The Board has not established its own. insurance funds, nor does it at present intend doing so. The Act in its present form is not of much value, as it limits considerably what a Board may do. Mr O. Blenkhorn seconded the motion. .

Mr Vincent said that none of the replies received had much bearing on the matter, because most of- the Boards had not considered the proposal. Two of the Boards had considered it and turned it down: Thames said , they would have been heavy losers, and Central had no intention of going in for it. Wairarapa evidently wanted to start their own scheme if allow’ed to put something aside. Mnnawatu-Oroua were probably favourable, though they had not considered it-. Somebody, however, had to make a start, and he was quite convinced that- (the proposal would be to the best interests of this Board in future years.

LIMITATIONS OF TIIE ACT

The secretary explained that the Act of 1927 was rather vague. It- apparently gave the Boards power to set aside funds for fire insurance, but not to create a reserve for other risks.

The chairman (Mr G. A. Monk): Fire is not worth worrying about. The secretary said that, according to one interpretation of the Act, the Boards could not insure motors. The position was'rather singular. This Board had carried its own public risks and insured its motors. The Southland Board had carried its own risks in regard to motors and third parties, but had insured against public risks. Mr C. Blenkhorn: Does there have to be any Government sanction, or do we simply decide to do it? The Secretary: Yes; only it lias to be in accordance with the Act. As fains public risk and accidents are concerned, we can only set aside what we pay in premiums. For fire, it seems, we can set aside a lump, sum. In reply to a question, the chairman said that" the public risk w-as the risk of accident to other persons than employees. Provisions of the Act were read by the secretary showing that in regard to fire insurance the Board might set aside a sum and invest it; and that the Board might establish accident funds representing no greater sum in any one year than the amount that at current rates would have been payable in that year in respect of workers employee

by the Board and in respect of public risks. CHAIRMAN OPPOSES MAJOR PROPOSAL. The chairman stated that he had considered the matter fairly fully since the last meeting, and there was, as Mr Vincent had pointed out, little to guide them, because the majority of Boards had not considered the matter and so were not in a position to give advice. He had come to the conclusion that for the Board 10 take the whole of its risks would be unjustified. It had been carrying public risks ever since it started, but to add on to that the accident risk would be too great a chance to take. However, there was something tc be said for Mr Vincent’s move, seeing that the Board had carried a public risk over a number of years. Ho felt that, the Board might go so far as to take its own'public risk by establishing a fund. Personally, he was against going any further than that at this juncture. Had the. legislation giveu them an opportunity to start when the Board was inaugurated, they would probably have had a fair fund, but the amended Act had only been in force for two years. In view of the possible accidents from wires and other causes, he bid not.think thatthe Board should cany the public.risk any longer unles« it established a fund. ‘various rates compared.

(Mr Blenkhorn said he was inclined to establish the fund in its entirety. The question of the rate had to be 'looked at, and he did not know, whether members had inspected the insurance companies’ rates for the different classes of work, but they were very informative. The rates charged for such an undertaking as this Board’s did not seem to him to, be excessive. The Chairman: They raised the rate last year to 455. , Mr Blenkhorn: Compare it with the rates for other works. .Por timber workers it is about 80s; and for casual workers'on the wharves in Welling ton, 50s. Seamen’s rates are also very much in elxccss of ours. Borough employees’ ordinary rates are 30s. I am quoting these figures to show what the risk is considered by experts. I think it is notorious that all largo shipping companies carry their own accident insurance and do very well out of it. Another thing to be considered is that we are past- the initial and therefore most dangerous stages of our undertaking. The Chairman: I don’t agree with that- Every wire is a live wire. A lot of our work up to the present was on dead lines. *

Mr Blenkhorn: I am open to correction on that point, with your greater acquaintance with the uundertaking, but it seemed to me that that'was the case. We had a number of new men on a new scheme, a time they would become more skilled and more careful in carrying out their work. We have had freedom of accidents, due to the men themselv'es, a>nd the competence of the supervision exercised over them. We have a fund out of which we can pay possible claims; and, the whole business being a risky one, I do not see that we should be deterred by the fact of that risk and by the fact that other Boards have not started the scheme, but should undertake it ourselves. In the ease that Mr Vincent quoted of the Palmerston Borough Council, they are evidently very much enamoured of the scheme and have made a considerable sum out of it; it has been established some two years. They had for a period only carried half; it was a very difficult matter to make up one's mind about I consider it from the light of what insurance companies think themselves.

The Chairman: They are telling us it docs not pay. Mr Blenkhorn: They establish palatial buildings and pay handsome divi-, dends. b

The Chairman: They- say it comes out of the interest more than from

, Mr Blenkhorn: The accident side is not considered the most profitable. Air Vincent: They chase it, though. The Chairman: They have had to raise the rate.

HALF LIABILITY SUGGESTED.Mr W. E. Barber .said his idea was that the Board could go in for a 50/50 scheme.

Mr Blenkhorn: I am rather inclined to that. Mr E. S. Morse: I cannot alter my mind that- the risk is not worth taking. The thing uppermost in my mind is the phenomenal run of luck this Board has had. If Mr Vincent, had been a member of the AlanawatuOroua Board, I think he would not have considered this question for five minutes. It is going to be a phenomenon if the Board continues without ani’ serious accident for any great length of time. I think that the small amount in premiums now paid is not worth considering. Air Vincent: In connection with accidents to Power Boards and thr-ir employees, Manawatu-Oroua bulk largely in our eyes because they are close to us and have had a- bad run; but what about the general run of Boards? From the Chief Engineer’s report there did net appear to bo a great number throughout the country.

CONCESSION ON CERTAIN POLICIES.

The secretary stated that during the Power Boards’ Conference, the secretaries of the Boards approached the insurance companies for a reduction in rates, and all they got was 25 per cent on the insurance of motor vehicles, third party risks, etc. The companies would not budge on the accident rates; they represented that they were losing money on them. Mr Vincent: Has the executive considered this? The Chairman: Yes. The first idea was to estaolish a fund embracing ; tile Power Boards of the Dominion. > Some, however, did not care to tackle 3 it, and it w r as finally decided 7 by the executive to approach the insurance ; companies, and we got a reduction of 25 per cent, on motor vehicles. With d regard to the public risk, if we are

not prepared to set aside a fund ourselves, we should insure. I am not prepared to go any further. I suggest that Ave initiate this by establishing our own fund in regard to public risk. I would not suggest that for a moment if we had not a fair reserve. I am not prepared to take the whole of the risk; I do not want to see the reserves used up in one fell swoop. Mr Vincent: With one fell swoop they might go even if wc are insured. The insurance companies will only take a certain amount.

The Chairman: I must vote against the motion. If you reduce it to public risk, I will support it. - Mr'Vincent suggested that the Chairman move an amendment.

The Chairman: I. will just vote against it. We can have it up again in some other way. We must insure against public risk, whatever happens. The motion was then put to the meeting and was defeated, only the mover and seconder voting for it. PUBLIC RISK TO BE AGAIN ’ CONSIDERED.

The chairman remarked that he would have preferred that Mr Vincent had compromised and gone part of the way. The matter of public risk would come up at the next meeting. Mr Blenkhorn: And we will be quite in order probably to bring up another motion on the lines of half and half. The Chairman: Yes, that will be quite in order.