NATIONAL MUTUAL LIFE.

Taranaki Daily News, 11 January 1921, Page 7

NATIONAL MUTUAL LIFE.

TOTAL FUNDS £14,000,000. A PROSPEROUS INSTITUTION. The annual meeting of policyholders in the National Mutual Life Association of Australasia, Ltd., was held at Melbourne on the 22nd ult. Mr. A. Newell presided. The Chairman said that the report showed that the association had made very good progress during the year. The new business of £6,496,608 was £806,191 greater than last year’s total. The premiums received had increased by £'178,955, the interest received had increased by £54,432, and the total income for the year, £2,342,054, show’ed an increase of £225,545 when compared with last year.

LOW DEATH RATE.

Those figures indicated the extent of the growth of the association business, but perhaps the most remarkable and the most satisfactory item in the report was the amount of claims paid under policies in consequence of the death of the policyholders. That amount, £381,154, was £254,101 less than the amount so paid in the previous year. The decrease was equal to 40 per cent, of last year’s figures. That was the first of the association’s financial years since 1913 that was entirely outside the period covered by the war. The most important effect on the business of that awful cataclysm which threatened to submerge the whole world was shown in the rate of mortality amongst policyholders. In 1914 only, two months of which were included in the war period, the rate was equal to 8.67 per thousand of.the mean amount of assurances in force. In 1915 the rate increased to 10.92 per thousand. In 1916 to 12.01; in 1917 to 12.72; in 1918 to 13.03, and in 1919 to 15,57 per thousand. That last rate —715 per cent, higher than the 1914 rate —was due partly to the influenza scourge, which, coming immediately after the war, aggravated the association’s misfortunes. But even then it did not exceed the amount that had been provided for.

THE FINANCIAL YEAR.

During the financial year that had just closed the rate of mortality had fallen from 15.57 to 8.39 per thousand of the mean amount of assurances in force, or to less than the 1914 rate. The experience of a high death rate during those years was not singular; nearly every company had suffered. Some idea of what it involved might be formed from the fact that in the five years 1914-1919 £750,000 more was paid away than would have been paid if the rate of mortality had been normal. The extra payments by companies generally must have amounted to many millions. But the war had another important effect on the association; it cheeked for a time the growth of the amount of new business transacted, which had been steadily increasing. From 1914 to 1917 the new business fluctuated ‘between 3 and 3j millions; in 1918 it rose to nearly four and one-third millions; in 1919 to over five and a-half millions and in 1920 it was nearly six and a-half millions, so it could be claimed that the association had fully recovered from the ill-effects he had referred to. The mortality rate was down to the pre-war level, and new business had reached an amount that could hardly have been expected in 1914. It was nearly £3,000,000 more than the total for that year. A remarkable feaure of the policies issued in recent years was the higher average amount assured. In ]914 the average amount assured under each policy was £286; in 1920 the average had increased to £384.

NEW BUSINESS.

At the last annual meeting reference was made to the large increase of new business which was common to nearly all companies operating in English-speaking communities. Whatever the cause might be, whether it was a hew appreciation of the advantages of life assurance as the only means of providing for the uncertainty of life or that strange condition of an abundance of money in a world that was actually poorer than it was six years ago—the effect on the community was certainly good. Notwithstanding the unfavorable circumstances to which he had referred, £5,053,000 had been added to the Assurance Fund in the six years since 1914, and £1,234,031 of that amount was added during the past year. The amount of interest earned during the year, £681,211, after deducting rates and taxes, was equal to £5 3s 8d per cent, of the mean funds. That was lower than the current market rate for the year, but it must be remembered that a large proportion of the funds was invested for fixed periods, some of which had still many years to run, and it was therefore not available for investment at the higher ruling rates. Still the return was good; it represented nearly £45,000 more than would have been received if the associations’ present funds had yielded the Tate that was received in‘l9l4. The cost of conducting the business compared with income was a little higher than last year, but that was accounted for by the larger amount of new business transacted.

SECURITIES.

Amongst the items in the balancesheet the principal change was in Government securities, which were mainly war bonds. Those amounted to £5,643,256, or over £2,000,000 more than the amount in the last balance-sheet. At the close of the books £885,000 had still to be paid, and that amount appeared amongst the liabilities. The loans to policyholders, to enable them to subscribe to war loans, had increased during the year by £112,000. Thus it would be seen that the whole of the increase in the funds had been used to help the Government. Loans on mortgage had been reduced to some £660,000, and that amount also had been invested in Government securities. The results that were placed before policy-holders could not have been obtained without an efficient organisation. The staff had given good service at the head office and at the branches, but he wanted to recognise specially the work of the agency staff —it* yvas due to the exertions of that staff that the association had been enabled to transact such a large amount of new business during the year. Whatever the future might have in store, policyholders might rest assured that the interests of members were in safe keeping. The report was adopted. Sir J. H. MaeFarland was re-elected director. J. R. M. Stewart District Manager. (Published by Arrangement.)