REPORT OF THE EARTHQUAKE AND WAR DAMAGE COMMISSION ESTABLISHED UNDER THE EARTHQUAKE AND WAR DAMAGE ACT, 1944, FOR THE YEAR ENDED 31st MARCH, 1948

Appendix to the Journals of the House of Representatives, 1948 Session I, B-11

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1948 NEW ZEALAND

REPORT OF THE EARTHQUAKE AND WAR DAMAGE COMMISSION ESTABLISHED UNDER THE EARTHQUAKE AND WAR DAMAGE ACT, 1944, FOR THE YEAR ENDED 31st MARCH, 1948

Presented to both Houses of the General Assembly pursuant to the Provisions of the Earthquake and War Damage Act, 1944

Wellington, 17th June, 1948. In accordance with, the provisions of section 23 of the Earthquake and War Damage Act, 1944, the following report, with a statement of accounts, is presented for the year ended 31st March, 1948. (1) There was no change in the personnel of the Commission during the year. Eleven meetings of the Commission were held. (2) The following is a comparative statement from the 19th December, 1941, when the War Damage Act came into operation. As from the Ist March, 1944, earthquake insurance was included in the scheme :

— Period 19 th 1 December, 1941, to 31st | March, 1945. Twelve Months ended 31st March, 1946. Twelve Months ended .31st March, 1947. Twelve Months ended 31st March, 1948. Income — £ £ £ £ Premium 4,232,166 365,861 410,065 494,938 Interest 173,608 104,725 94,860 129,957 Outgo— Claims 1,093 507 1,779 7,917 Salaries 10,826 2,035 2,162 2,493 Other working-expenses 3,513 1,221 2,091 1,335 Discount to insurance offices 8,834 8,733 9,965 11,843 Audit fee 295 75 ' 75 75 Surplus 4,381,213 458,015 488,853 601,232 Total of Fund 4,381,213 4,839,228 5,328,081 5,929,313 Ratio, per cent., of working-expenses to premium 0-346 0-910 1-055 0-789 income exclusive of discount to insurance offices

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(3) Four hundred and one claims on the Fund were lodged during the year, as compared with one hundred and thirty-four in the previous year, and only eighty-two in the year before that. Earthquake damage was claimed for in localities from Auckland to Southland. The most damaging shocks occurred in rural and farming areas, where buildings are mainly of wood and are well separated. Had the cities or large towns, where there are so many older buildings of heavy construction of a type lacking resistance to earthquake, been similarly shaken, the damage would have been very much more serious. Earthquake shocks which caused the most severe damage in various localities are listed as follows :

An unusual form of earthquake damage in this Dominion was suffered on 26th March, 1947, when a sea wave, occurring as the direct result of an earthquake, swept a part of the Poverty Bay Coast, doing damage to buildings and their contents, for which claims made on the Fund were paid during the year. (4) The Commission feels impelled to point out that of all natural causes of loss to which the Dominion may be exposed earthquake is the most likely to cause disastrous damage, and that the Fund, although now growing satisfactorily in the absence of heavy claims, will be insufficient for years to come, independently of the contingent guarantee of the State, to meet losses arising from a severe earthquake in one of the main centres. Prudence urges therefore that the Fund, which is restricted to indemnification for damage caused by earthquake and war only, should not be encroached upon to provide relief for other kinds of loss, however deserving. A different system of collecting premiums would be needed under any scheme of national insurance which might be established for the protection of those who suffer at present uninsured losses through damage to land, crops and stock, or other property. Compulsory contributions to the Earthquake and War Damage Fund are restricted to property which is insured against fire. Land, of course, is never so insured. (5) The ratio of working expenses (0-789 per cent.) for internal administration, including cost of audit by officers of the Commission, is less than for the previous two years. In addition, the Commission pays per cent, for collection of premiums. (6) At the close of the year under review the total sum invested overseas was £(N.Z.)1,500,000. (7) The Commission desires to express its high appreciation of the competent service rendered by the Secretary and his small staff under a much heavier burden of work than occurred during the previous year. J. H. Jekram, Deputy Chairman.

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Date. Location. Modified Mercalli Scale Bating. Number of Claims. 24th April, 1947 Eastern Southland Force V 32 6th June, 1947 East Coast (Tokomaru Bay and Tolaga Bay) Force VII 64 23rd August, 1947 .. Gisborne district (Matawai and Motu) Force VI 38 15th January, 1948 .. Wanganui district Force VI 153

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EARTHQUAKE AND WAR DAMAGE FUND (Under Earthquake and War Damage Act, 1944.) Income and Expenditure Account for the Year ended 31st March, 1948 £ s. d. £ s. d. £ s. d. Net premiums .. .. .. .. .. 494,938 4 3 Claims paid and outstanding .. .. .. 7,916 11 0 Interest .. .. .. .. 142,741 19 9 Salaries and overtime .. .. .. .. 2,493 9 10 Less premium and costs incurred in Fees of Members of Commission .. .. .. 299 17 6 purchase of Imperial stock .. 12,785 7 9 Expenses of management .. .. .. .. 1,109 13 7 129,956 12 0 Discount allowed insurance offices .. .. .. 11,843 3 0 Balance transferred to Earthquake and War Damage Fund .. .. .. .. .. 601,232 1 4 £624,894 16 3 £624,894 16 3 Balance-sheet as at 31st March, 1948 Liabilities Assets £ s. d. £ s. d. £ s. d. Balance of Earthquake and War New Zealand Government stock .. .. .. 4,270,000 0 0 Damage Fund as at3lstMarch, 1947 5,328,081 4 9 Imperial stock .. .. .. .. .. 1,500,000 0 0 Net income for year ended 31st March, Cash in Public Account to credit of Earthquake and 1948 .. .. .. .. 601,232 I 4 War Damage Fund .. .. .. .. 52,833 13 8 5,929,313 6 1 Interest accrued but not due .. .. .. 31,741 15 7 Claims outstanding .. .. .. .. 3,500 0 0 Premiums accrued but not due .. .. .. 85,77000 Discount due or accrued premiums .. .. 2,146 1 4 Sundry debtors .. .. .. .. .. 2113 6 Premium and other deposits .. .. .. 5,407 15 4 £5,940,367 2 9 £5,940,367 2 9 Note.—In the balance-sheet, New Zealand Government stock has been included at par value and Imperial stock has been included at par value converted to New Zealand currency. 11th June, 1948. T. L. Seator, Secretary. I hereby certify that the Income and Expenditure Account and Balance-sheet have been duly examined and compared with the relative books and documents submitted for audit, and correctly state the position as disclosed thereby.— J. P. Rutherford, Controller and Auditor-General.

By Authority: E. V. Paul, Government Printer, Wellington. —1948.

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Approximate Cost of Paper.—Preparation, not given ; printing (1,238 copies), £B, 10s.

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