EQUITY AND LAW LIFE ASSURANCE The Equity and Law Life
Assurance Society is one of those institutions which have expanded very rapidly in the last fen' years. In 1932 it was a comparatively small institution, with total funds of around £ro,000,000. In 1938 this total had risen to £3o,000,000, and it could be counted an institution of size and importance. Sir Dennis Herbert's address last week wa: concerned largely with those problems which are peculiar to rapidly growing insurance business. He pointed out that 3 large increase in new business necessarily involves an addi- tional burden on the funds during the period of increase, so that so far from bringing an immediate increase in profits, a rapid growth causes a temporary reduction or at least a post- ponement of profits. For these reasons an insurance office which has long had a large established business is often averse to an abnormal increase in new business.
But a sound small business such the Equity and Law was seven years ago can, he said, legitimately accept a large amount of new business so long as it adheres to sufficiently stringent actuarial reserves. As to those reserves Sir Dennis is in n° doubt. He announced that in the valuation of the subsidiary companies alone there was an undisclosed reserve of !wady £5oo,000, that assets not shown in the balance-sheet fully cover the investment depreciation, leaving the investment reserve of £roo,000 intact. The Equity and Law has acquired at slightly under par 5o per cent. of the Preference shares and 221- per cent. of the Ordinary shares of Western Ground Rents, which has acquired the Bute Estate at Cardiff. In Sir Dennis Herbert's view, the ordinary shares should acquire a value
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