COST OF INSURANCE.

Taranaki Daily News, Volume LVII, Issue 49, 15 July 1914, Page 4

COST OF INSURANCE.

Some statements were made in the JHousc of Representatives the other .afternoon which merit the earnest attention of all people who desire to promote the best interests of the masses of the people of this Dominion. We have on previous occasions urged that it would be to the advantage of New Zelaand as a whole if accident insurances were wholly under the control of the State. Speaking in this connection, Mr. T. 11. Oavey, member for Christehurch Hast, argued that if one office were substituted for many expensive competing organisations, the public would get better value for its premium. The Minister in charge of the State Insurance Department had informed him that insurance premiums bad been reduced, but this was contrary to the Department's report, which said they 'had been increased. Last year's income of (-.he State Insurance Accident Department was £23,512; the claims were £]2,l)l(i. and it actually cost £721!!) (one-third of (he whole income) to meet expenses in the , way of commissions. There was great; I waste over this business, as little "more than 'half of the premiums went back in claims. Taking the accounts of all accident insurance companies trading in New Zealand, lie had asertained the following facts:—

Year. Premiums. Claims paid. Difference. 101) £205.858 £133,029 £132,829 1912 325,148 145.301 179,947 1913 311.381 148,000 173,000 "The oomr.Li:,sioiis in 11)11," continued Mr. Davey, "totalled £95,000, while in 1912 they reached .CIOfi.OOO. and last voar €145.00(1--a feartul sum. These figures show that there is enormous waste over the system," said Mr. Davey. He eonsidered the amount of .CIOfi.OOO paid in commissions and to expert doctors, "to swindle men out of their just

rights," was much too large. Palatia establishments were kept up in the cities and 15 to 25 per cent, commission pail on premiums received. He advocate! the establishment of one office, then i would not he necessary to pay theai enormous sums away for no advantagi to the insured men. "We are not giving as good compensation as Russia," de clared Mr. Davey. "Our men are paic half wages during incapacity, but ii

Itussia they get half wages and meilica' expenses for six months. We paid onlj £1 expenses; in Italy they get compensation for three months, and in Belgium they have medical aid until a final eure." The answer made by the Ministoi ill charge (Hon. P. M. B. Fisher) was not as statesmanlike as we would have liked to have seen. To reply that "the conditions were just as the Liberals left them" may have 'been smart political rejoinder, but it disclosed the fact that •the "Reformers" have at least another problem tihat they-are not prepared to "reform." .Still, Mr. Fisher did go on to admit that the cost of getting accident business was a good deal more than the claims. Which admission clearly shows that something ought to be done, and done promptly, to lessen the •procuration costs and to enlarge the benefits to all these who are insured against accident. In our opinion the .best way to do this will be to eliminate the competition, by the State assuming the sole control of our accident insurance.