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Liberal Conditions.
The chief and unique condition is that every policy issued is guaranteed by the State, thus conferring
the most complete security possible, and one which private offices are not in a position to offer.
No extra premiums are charged for any occupation other than that of hotelkeeper, but in the event of war, as in the South
Occupation and Residence.
African War, new proposals received from privates proceeding to the front are specially dealt with. Nor is any extra premium charged for residence in other parts of the world, unless at the time of proposing it is intended to proceed to some unhealthy tropical region.
The suicide clause contained in the policies is more liberal than is usual in life-assurance contracts : although a policy may be declared void if suicide occur within
six months of its issue, the Commissioner is empowered to pay the claim if he is satisfied there was no suicidal intention when the contract was made. This liberal regulation has been found sufficient to protect the office, while it prevents injustice or hardship to third parties.
Substantial surrender values and loan values are allowed after two years, and, moreover, if the premium is not paid within the thirty days of grace an account is opened
crediting the policyholder with the surrender value and increases therein, and debiting him with the premiums as they fall due and interest thereon. As long as the amount to credit exceeds the amount owing the policy is in full force, and in the event of death or maturity the sum assured and bonuses, less the arrears with interest, are paid.
The following are some examples of the benefits conferred by this regulation, taken from the claims
Examples of Non-forfeiture.
which occurred last year :—
Policy No. 2059, issued in 1872. The assured borrowed from the Department on the security of this policy and then left the colony, The payment of premiums was
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neglected from 1896 until the death of the assured in 1905, but the surrender value and the bonuses allotted from time to time were sufficient to meet the overdue premiums, and the claim was duly paid.
Policy No. 59664, issued in 1888. The premiums were paid up to 1900, when they became overdue, but the policy was kept in force by the surrender value until the death of the assured in 1905. At that date the position was as follows :—
|
£ |
s. |
d. |
| Sum assured |
500 |
0 |
0 |
| Bonuses |
111 |
11 |
0 |
|
611 |
11 |
0 |
| Overdue premiums for five and a half years |
98 |
6 |
10 |
| Balance payable to assured representatives |
£513 |
4 |
2 |
Policy No. 13640, issued in 1880. The assured left New Zealand in 1888, and neglected to pay any further premiums. The policy matured in 1905, and, notwithstanding that sixteen and a half years' premiums were owing, and some of the bonuses had been taken in cash, there was a small balance in the assured's favour, which was duly paid over. The fact that the policy had any value seems to have been forgotten, for the document could not be found, and the Department had to issue a copy for the purpose of obtaining the usual discharge.
Policy No. 51997, issued in 1885. The premiums were paid to 1890 only, but the policy was in full foree at maturity, fifteen years later.
In more than one case a policy has matured long after its existence was forgotten, and the Department has had to advertise in the public Pre as before the assured could be found.
With the exception of the suicide clause there are absolutely no restrictive indorsements on policies, the assured under
every policy having perfect freedom to travel where he pleases and engage in any occupation, with the satisfaction that, as long as the premiums are paid in cash or from the surrender value, the policy will be in no danger.
With a few exceptions all policies are protected by the laws of the celony from bankruptcy to the extent of £2,000 (exclusive of bonuses), or in the case of annuities
Protection against Bankruptcy.
to the extent of £104 per annum, but this does not avail to protect any policy from passing to a trustee in bankruptcy if it be proved to the satisfaction of a Judge of the Supreme Court that such policy was taken out by the bankrupt with intent to defraud his creditors.
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An important change in the method of vesting of bonuses was made a few years ago, when it was arranged that bonuses should vest on the death of the assured, whenever
Bonuses vest immediately.
that might happen, not having to wait until the policy is two years' old—the bonuses being of no value whatever in the interval—as in other offices. The Government Insurance Department was, it is believed, the first office in the world to give this privilege, and one other Australasian office has recently followed the example.
The latest amendment of practice has reference to interim bonuses. These have hitherto been allowed only in the case
of policies emerging by claim between two triennial distributions of surplus. Arrangements have now been made to include interim bonuses in all calculations of surrender values, either in cases where policies are actually surrendered or borrowed upon, or for the purpose of giving the largest possible cover where the premiums are overdue. Even in the case of a yearly distribution of surplus, the policyholder who is unfortunately compelled to surrender forfeits on the average half a year's bonus, but under the Department's new system he receives the proper proportion of accrued bonus for every premium paid since the last valuation. In fact, it is not the policy of the office to try to make a profit out of the necessities of those policyholders who become "hardup." This method of interim bonuses is unique, and gives all the advantages to policyholders of a division of profits as often as a premium is paid, without the expense of a regular allotment.
The reports issued annually and trienially by the Department are designed to furnish policyholders and the world in general with full information about the working
The utmost Publicity afforded.
general of the office. The accounts and balance-sheets give the fullest details, and the opinion was recently expressed by an English critic that the form of Statement of Business published with every Annual Report is one well deserving of imitation by all offices that court public inspection.
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neglected from 1896 until the death of the assured in 1905, but the surrender value and the bonuses allotted from time to time were sufficient to meet the overdue premiums, and the claim was duly paid.