SPECIAL PROVISIONS AS TO INDUSTRIAL ASSURANCE COMPANIES. Section 12. In the exercise of my powers under sub-section 2 I made the Industrial Assurance (Deposits, &c.) Rules, 1924, (S.R. & O. 1924, No. 754), which are similar to those made by the Board of Trade for ordinary assurance business, and govern deposits, the custody, inspection and certification of documents, and the qualification of actuaries, as far as industrial assurance business is concerned. Sub-section 3 (d) gives the Commissioner power to refuse to issue a warrant for a deposit, if he considers it inexpedient that a company should be authorised to carry on industrial assurance business. I do not take this to apply to a company which was already carrying on such business at the commencement of the Act, but only to a company which subsequently applied for a warrant in order to carry on such business. Whether this construction is right or not, it is clear that to refuse a warrant in the case of an existing industrial assurance company might inflict a hardship on the existing policy owners, and I therefore decided that the one or two dubious cases ought to be dealt with under other portions of the Act. In the case of the new applications which have been made, I considered whether I ought to grant them and decided to do so. Sub-section 3 (b) provides for a special report by the auditor as to the propriety of the apportionment of expenses, etc., between a company's industrial assurance business and other business. In answer to a request from a company, I agreed to the following form of certificate: The expenses of management, interest and dividends from investments, and sums on account of depreciation of securities appearing in the foregoing accounts have been apportioned between the industrial assurance business and the other business of the company, and we are satisfied as to the propriety of the apportionment. ANNUAL ACCOUNTS AND RETURNS. Section 16. The first set of annual accounts and returns over which the Commissioner has jurisdiction are those for 1924, and these cannot be dealt with before the Report for 1925. The present Report, therefore, does not deal with statistics, which, up to the end of 1923, or, in the case of companies which make up their accounts to a date other than December 31st, up to the date at which the accounts covering part of 1923 are made up, remain within the jurisdiction of the Board of Trade, as far as industrial assurance companies are concerned. The accounts of collecting societies up to the end of 1923 will be dealt with, as before, in the Report issued by me as Chief Registrar of Friendly Societies for that year But, as this Report is appearing at an earlier date than the Chief Registrar's Report, I append a summary of the figures relating to collecting societies for the year 1923. The most anxious and disagreeable task which awaited the Commissioner on the passing of the Act was that of purging the business of certain concerns, which, under proper restrictive legislation, would never have come into existence. I was fortunate in being able to delegate the duty of holding the inspections to the Deputy Commissioner, whose conduct of these difficult inquiries and subsequent reports merits the highest commendation. Inspections were held into the affairs of the following societies: Scottish Provident Assurance Collecting Society. United National Friendly Assurance Collecting Society. Provident Co-operative Collecting Society. On receiving the Inspector's reports in the case of the United National Friendly Assurance Collecting Society, the City Mutual Assurance Collecting Society and the Householders' Provident Collecting Society I awarded that these societies. be wound-up. The winding-up of the United National Friendly Assurance Collecting Society has been completed, but there were no assets available for distribution. The winding-up of the City Mutual Assurance Collecting Society and the Householders' Provident Collecting Society have not yet been completed, but I do not anticipate that there will be any assets for distribution. As an alternative to winding-up in the case of the Legal Co-operative Collecting Society and the Provident Co-operative Collecting Society, the engagements of these societies were transferred to the Bristol, West of England and South Wales Friendly Collecting Society. No formal report was made in the case of the Scottish Provident Assurance Collecting Society and the New Excelsior Friendly Society. The Inspector's reports are printed below in Appendix III, page 45. VALUATIONS. Section 18. As in the case of annual accounts and returns, valuations cannot be dealt with before the Report for 1925, inasmuch as the provisions of the Act only apply to valuations made as at December 31st, 1924, and thereafter. I have, however, taken steps under Section 18 (3) in the case of one company and of one society. In the former case, the pressure which I was able to apply led to a scheme of reorganisation, which, though outside my actual control, had my approval and will, it is hoped, result in a more prosperous future for the company. In the case of the society, which had made a deposit and therefore could not be dealt with on an application for postponement of deposit, steps have been and are being taken which should, in due course, with good management, result in solvency and a satisfactory future. In both cases, it should be added, it was unnecessary to hold an investigation. The method which I pursued and which I suggest ought to be pursued, where possible, by an official or a Department which is armed with such powers, was to indicate to the office that the Commissioner would have to act, if there was no improvement, and to ask it to take of itself the necessary steps. It will perhaps be well to remind societies and companies that the Commissioner has power to call for the additional particulars set out in the Second Schedule to the Act. Which, if any, of these particulars will be called for cannot be stated until the valuation is submitted, and it will therefore be prudent for every office to put and keep itself in a position to supply all or any of them. POLICIES. The useful provision, which enables the Commissioner to approve a statement of the effect of the sections enumerated in Schedule III, Part II, which may be set out on the policies instead of the actual sections, was utilised by almost, if not quite, every office. With the assistance of the representatives of the principal societies and companies, such a statement was prepared and approved by me, and I also prepared and circulated two statements, one for societies and one for companies, as to the effect of Section 62 of the Friendly Societies Act, 1896, and Section 4 of the Industrial Assurance Act, 1923. Subsequently, on the passing of the Friendly Societies Act, 1924, I prepared a fresh statement, which is now in common use. These statements are set out in Appendix IV, page 91. It may, perhaps, be added that while it is no part of the Commissioner's duty to advise offices as to the form of their policies in other respects, he has been able to give some assistance in this matter also. FORFEITURE NOTICES. Section 23. Although this section reproduces Section 3 of the Collecting Societies and Industrial Assurance Companies Act, 1896, precisely with the substitution of 28 days for 14 days, and with an addition as to ordinary contracts of collecting societies, which is really a drafting addition, and that section in its turn substantially reproduces Section 30 (2) of the Friendly Societies Act, 1875, so that the section has been in force for just half a century, yet there are practically no legal decisions upon it. The Commissioner appears to be rapidly remedying that defect. The question of the construction of this section comes up for decision again and again, and, though some important points have been already decided, there are some still more important ones which obviously will have to be settled sooner or later. The more important decisions up to the end of the year 1924 will be found in Appendix V to this Report, page 98. FREE POLICIES AND SURRENDER VALUES. Section 24. The compulsory granting of free policies and, in certain cases, surrender values calculated in accordance with the Act does not come into force in the case of forfeitures of policies occurring before June 7th, 1928, and until that date the matter is entirely one of contract between the assurers and the assured. A misapprehension that the provision was already in force has. led, I am afraid, to a good deal of unnecessary correspondence both with this Department and with the various offices. One rather attractive letter addressed to the Commissioner may perhaps be quoted : "I have decided to discontinue payment of premiums. on my policies in the X company and have applied to agent for surrender values as per conditions. On my instructing him he simply went mad with rage and has declined to deal with the matter. I have since been advised to put the case into your hands and trust you will give it your early attention and oblige. Yours faithfully," The notice which has to be printed in each premium receipt book under sub-section 3 of this section usually in practice consists of a copy of that portion of the statement set out in Appendix IV, page 93, which relates to the present section. COURTS (EMERGENCY POWERS) ACT POLICIES. Section 28. The following was the method of publication which I approved under sub-section 3 of this section : 1. That the Notice required by the Act as agreed when approved by the Industrial Assurance Commissioner shall be published twice, in at least two newspapers in general circulation in every county where the Industrial Assurance Offices carry on business, as agreed with the Commissioner. 2. That a copy of the Notice shall be printed as a mediumsized poster and exhibited in each Superintendent's Office. 3. That a print of the Notice, with a tear-off at the bottom, be prepared and sent to each Representative of each Office, who will certify that he has received a copy of such Notice, with instructions to inform any Policyholder making inquiry to whom the Notice applies of the facts, and to supply him with a copy of the Notice, and that a reasonable number of loose copies of the Notice shall be supplied to each Superintendent, so that he can furnish any Agent or person requiring the information with a copy of the Notice. The notice published was as follows: INDUSTRIAL ASSURANCE ACT, 1923. Notice to Owners of Pre-War Policies protected by the This notice applies to any life policy or endowment policy (a) which was taken out before August 4th, 1912, and (b) which is for an amount not exceeding £25 or payments equivalent to that amount, and (c) on which premiums are payable weekly, fortnightly, three-weekly, or monthly, and (d) on which premiums were paid for at least the two years preceding August 4th, 1914, and (e) which has not been lapsed under an order of a Court since August 4th, 1914, or oherwise legally discharged. If the payment of premiums on any such policy was not kept up for any period between August 4th, 1914, and June 7th, 1923, the owner of the policy can either (1) Pay before February 1st, 1924, all arrears of premiums due and go on with the policy; or (2) Instead of paying the arrears of premiums, apply in writing before the 1st February, 1924, for a new policy, either to the agent who usually visits him or her or to the head office of the company or |