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A Summary of the Acts and Plain Directions for the Guidance of Persons Desiring to Insure their Lives or to Purchase Annuities.
The Government having been empowered by recent Acts of the Legislature to enter into contracts for Insurances on Life, and for the grant of Endowments and Annuities, the Commissioner, acting under the provisions of the Acts, thinks it necessary to call public attention to the particular classes of business which will be undertaken, and to the advantages secured to persons insuring under them.
The Acts referred to are "The Government Annuities Act, 1869," and "The New Zealand Government Insurance and Annuities Act, 1870."
I. The Commissioner is authorized to enter into contracts
Nature of contracts the Commissioner authorized to enter into.
for—
1. The sale of Immediate Life Annuities depending on single lives; or on joint lives with benefit of survivorship; or on the joint continuance of two lives.
2. The sale of Deferred Life Annuities depending on single lives.
3. The payment of a Sum of Money on Death; or on death within a period agreed upon; or at the expiration of a period agreed upon; but only in respect of persons between the ages of sixteen and sixty.
4. The granting of Endowments.
5. Generally, any contract whatever in the nature of Insurance, Endowment, or Annuity, dependent on the contingencies of human life, where not repugnant to public policy.
For the purposes of such of these various transactions as are
immediately contemplated, tables have been framed showing the purchase-moneys or annual or other periodical payments to be made in respect to the various Annuities, according to the several contingencies under which they are payable, and the premiums chargeable in respect of the several classes of Insurance and Endowment.?
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Special powers of Commissioner.
II. Amongst the special powers given to the Commissioner are the following, namely:—
1. That he may contract for the grant of Deferred Life Annuities on condition that the purchase-money paid shall, at the option of the purchaser, be returnable at any time before an actual payment of the Annuity, or that the purchase-money shall not be returnable.
2. That he may, in the case of inability to continue the payment of annual premiums for the purchase of a Deferred Annuity, grant to the person on whose behalf the payments have been made, an Immediate or Deferred Annuity equivalent in value to the amount actually paid.
3. Where a single sum has been paid for the purchase of a Deferred Life Annuity, he may grant, in lieu thereof, at the request of the person interested, an Immediate Life Annuity, proportionate to the amount paid.
Classes of Life Assurance confined to, &c.
III. With regard to Life Assurance, it is proposed at present to limit operations to Assurances in the following cases, namely—
1. For the payment of money at the death of the party whose life is insured—
| a. | By payment of premiums during the whole term of life. |
| b. | By payment of premiums for a specified number of years. |
| c. | On death occurring within one or seven years, by payment of annual premiums. |
2. For the payment of money on death or attaining a specified age, whichever may first happen—
| a. | By payment of premiums until death or until the specified age is attained. |
3. For the payment of money on the death of either of two lives.
4. For the payment of money upon the death of one life, provided another he then living.
The tables before referred to show the premiums payable in each separate case.
IV. It is intended, for the present, to confine transactions in the nature of Endowments to Endowments for Children, to be effected either by the payment of one sum or of annual,
Classes of Endowment confined to, &c.
half-yearly, or quarterly premiums, according to the tables annexed.
Contracts of this nature may be made conditioned—
| 1. | Without return of premiums, in case death happens before the specified age. |
| 2. | With return of premiums in such case.? |
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V. In the case of any Insurance for the payment of a fixed
Insurance may at death be commuted for an Annuity.
sum of money at death, the person insuring may, during his life, direct that the sum so payable shall at his death be commuted for an Annuity, according to the then tabular value, in favour of some person to be at the same time nominated.
VI. The following advantages are secured by special pro-
Advantages provided in the Act.
visions in the Acts to persons contracting under them:—
1. All money received and paid by the Government under
Account laid annually before the General Assembly.
the Acts is kept in a separate account, the particulars of which must be annually laid before the General Assembly.
2. In ease the funds held by the Government under the
Any deficiency to be met out of Consolidated Revenue.
Acts shall be insufficient to meet the liabilities, the deficiency is to be met out of the Consolidated Revenue.
Insurers are thus not only enabled to obtain authoritative information of the exact position in each year of the transactions effected under the Acts, but have also the security of the Consolidated Revenue for the performance of the Commissioner's contracts.
3. Annuities payable under the Act are exempted from all
taxation.
4. Policies, powers of attorney authorizing the receipt of
Exempted from stamp duty.
moneys, and receipts for moneys payable under the Acts are exempted from stamp duty.
5. The following transactions, subject to the limitations
Transactions exempted from Bankruptcy laws or seizure.
noted below, are exempted from liability to the law of Bankruptcy, and from seizure under process of execution, namely—
| a. | A Policy of Assurance bond fide effected by the Assured upon the life of himself. |
| b. | A Policy for a future Endowment for the wife or any child of the Assured. |
| c. | Any purchase of an Annuity for the wife or any child of the Assured. |
In the cases
a and
b, however, no policy or the contri-
Restrictions on exemption of policies and premiums from Bankruptcy laws and seizure.
butions made towards the same is protected until it has endured for at least two years, in which case the protection extends to the sum of £200;
After five years to £500;
After seven years to £1,000; and
After ten years to £2,000.
In the case
c, the Annuity and the contributions towards it
Restrictions on exemption of Annuity Contracts and Premiums from Bankruptcy law and seizure.
are only protected—
| (1.) | When payments on behalf of the Annuity have extended over six years; or |
| (2.) | When it has been purchased at least six years before the commencement of the Annuity; and |
| (3.) | When the Annuity does not exceed £100 per annum. |
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Further restriction on protection of policies and Annuity contracts.
Further, the protection applies, in the case of an Assurance Policy, only in favour of the personal representative of the Assured; in the case of an Endowment Policy, only in favour of the nominee; and in the case of an Annuity, only in favour of the actual Annuitant, and then to such parts only of the Annuity as shall be payable after the Annuitant attains the age of fifty years.
Married women may contract as if sole.
6. Married women may effect policies and dispose of the money assured by will, as if single; and policies effected by married women are, subject to the following restrictions, freed from the debts or control of their husbands. The restrictions are—
Restrictions on protection of policies held by married women.
a. That a policy or contract for a Payment to be made on Death or otherwise, or for a Life Assurance or Endowment, held by any married woman, shall not be protected against the debts of her husband, unless it has endured for two years and then only to the extent of £200;
- If for five years, £500;
- If for seven years, £1,000;
- If for ten years, £2,000.
Restrictions on protection of Annuities purchased by married women.
b. That an Annuity shall not be so protected unless the payments made on account thereof have been made at annual or more frequent intervals during a period of at least sis years, or unless purchased more than six years prior to the commencement of the Annuity, and that such Annuity shall not exceed £104 per annum.
Insurance for benefit of wife and children.
7. Insurances may be effected by way of settlement for the benefit of the wife and children of the Assured, with power to apportion the amount; and such Insurance may be effected either in the name of the Assurer or of his wife, or of a third person as trustee, with his consent.
The premiums may be payable during life, or any less period not under seven years, and, in any case, yearly, half-yearly, or quarterly, at the option of the Assured.
Existing policies may be indorsed so as to operate as settlements, but notice of any such indorsement is to be given.
When no apportionment is made on such policy in favour of children specially, all the children of the Assured living at his death share equally.
To the extent of £2,000, the money payable under any such policy is to be free from the claims of creditors.
8. Proof of age once received, is sufficient for further transactions.
VII. In addition to the foregoing advantages, which are?
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specially provided in the Acts themselves, the following additional
Advantages provided by Regulations.
advantages are secured by the Regulations promulgated under their authority:—
| 1. | Transactions are effected without any charge to the Assured. |
| 2. | Premiums are received in most cases either yearly, half-yearly, or quarterly, at the option of the Assured. |
| 3. | Premiums may be paid at any Money Order Office in Great Britain, Ireland, or the Australian Colonies, on the due dates. |
| 4. | Days of grace are allowed for payment of premiums; and in case of death whilst any premium is in abeyance, the amount in arrears will be deducted from the sum payable to the Assured. |
| 5. | Residence is permitted in any part of the Australasian Colonies and in Europe. |
| 6. | Surrender values are granted after a contract has existed for five years, and may extend to the whole or part of a contract. |
| 7. | The Commissioner is in certain cases allowed, even on default of payment, to revive a contract. |
| 8. | Any contract open to surrender may be exchanged for any other contract within the provisions of the Acts, on reasonable terms. |
| 9. | Payments are made immediately on proof of death and compliance with the regulations in relation thereto. |
| 10. | Proposers will not be required to pay any fee for medical examination, or to pay the cost of any inquiry which the Commissioner may think fit to make with regard to their health, habits, age, and occupation, or to pay any fee for the issue of any contracts which may be made in accordance with their proposals, or to pay any postage for the transmission of their proposals, or for the transmission of any correspondence arising out of such proposals between them and the Commissioner, except as specially provided in clause 10 of Regulations. |
VIII. Certain restrictions are imposed by the Acts upon deal-
Restrictions imposed by the Acts.
ings with policies.
1. By section 21 of the Act of 1869, no Annuity purchased
Annuity contract not assignable.
under the Act can be assigned except in case of bankruptcy, in which case the said Commissioner is directed to repurchase at a tabulated value.
2. By section 15 it is declared that the Commissioner is not
Commissioner not affected with notice.
to be affected with notice of any trust affecting any Annuity, or any contract for payment on death or otherwise, made under the Act.
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Contracts rendered void and payments forfeited.
3. Section 25 of the Act of 1869 expressly renders void contracts, and directs all payments made to the Government thereunder to be forfeited, on the following grounds:—
- If any certificate or declaration shall be produced to any Officer employed in the administration of this Act which shall contain any untrue statement of the age of any person to whom an Annuity has been granted under this Act, or of any person who has contracted for a sum payable at death with intent to obtain an Annuity on the continuance of the life of any person under the age of ten years, or to obtain any higher rate or amount of Annuity or any Payment on Death greater than would or might be allowed under the provisions of this Act, according to the true age of such person.
IX. Provision is made for the settlement of disputes by arbitration.
Purposes for which Regulations may be made.
X. Power is given to the Governor in Council to make Regulations for the following purposes:—
1. For fixing maximum and minimum limits for the amounts of the several Annuities and Payments on Death and other payments to be contracted for under this Act.
2. For regulating the mode and form of making contracts under this Act, and for requiring medical certificates, either in every case or where demanded, and for providing that the rates of premiums to be paid for Annuities and Payments on Death shall be made to depend upon the goodness of the lives of applicants or others, and upon the insertion in or omission from any such contract of stipulations as to residence in the Colony or in particular places, and as to hazardous or unhealthy trades, employments, and occupations, and for requiring the payment of extra premiums or other moneys in cases where payments are to be contracted to be paid on death where the lives of the person or persons upon the deaths of whom such payments are to be paid are deemed bad, and, generally, for the payment of extra premiums or fines in cases of contingencies which may be declared by such regulations to be special risks.
Proof of age, death, and identity.
3. For prescribing the mode of proving the age and identity and the existence or death of persons, and the mode of paying sums of money payable in respect of Annuities and Payments on Death and other payments under this Act, and for dispensing with the production of probate of a will or letters of administration either generally or in any particular class of cases,?
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4. For the management of the accounts required to be kept
under this Act.
5. For prescribing beforehand the terms upon which pre-
Terms on which premiums are to be returned.
miums paid under contracts for payments to be made at death or otherwise shall be returned to any person beneficially interested in the contract, and for determining beforehand the cases or classes of cases in which no premium shall be returned.
6. For any purpose for which it may be necessary or
For any purpose that may be necessary.
expedient to make any rules or regulations for carrying this Act into effect.
7. For imposing penalties not exceeding twenty pounds
Imposing penalties. Rules and regulations to be published in Gazette.
for breach of such regulations. Provided that no such rules or regulations be inconsistent with or repugnant to this Act; and all such rules and regulations are to be published in the
New Zealand Gazette, and to take effect from the day of such publication, or from such other day as shall be therein fixed.
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specially provided in the Acts themselves, the following additional 
