HIGHLY SUCCESSFUL YEAR PROFITS FROM ALL DEPARTMENTS SIR EDWARD MOUNTAIN'S ADDRESS
PRESIDING on April 29th at the annual general meeting of the Eagle Star Insurance Company, Limited, Sir Edward Mountain. Ban., said that during the year 2,324 new life policies were issued for £5.891,684 gross (£5,835,877 net), practically the whole of which was transacted in the United Kingdom. The combined life and annuity funds now stood at £15,330,878, showing an advance of over £218,000 during the year.
NATIONAL SAVINGS SCHEME
The scheme we have advocated, which is run in conjunction with the National Savings Committee, is one whereby the employee sets out to save an agreed sum at the end of 15 years by purchasing Savings Certificates, and the employer guarantees, by means of a group life policy, that in the event of an employee dying during the 15 years, his dependants snall receive immediately the full amount he set out to save without further contributions.
The cost to the employer is very small ; the net cost after allowing for tax relief may work out as low as a penny per week for each is. per week contributed by the employee.
This scheme, which several important firms have taken up through us, has met with very great response from their employees. We have adopted it for our own company and a great many of the staff have joined the scheme.
The premium income was £841,682, an increase of £33,218, and from this there emerged a profit of £60,842.
The premium income from ordinary personal accident and sickness insurance amounted to £82,450. Owing to the cancellation of news- paper insurance contracts during the year, there had been a consider- able reduction in the premiums under this heading. Claims payments were £41,420 and after providing for outstanding claims and reserving 40 per cent, for unexpired liability, there was a profit of £18,077 to transfer to profit and loss account.
In the general insurance account, dealing with the various miscel- laneous classes of accident business, the premium income again showed an increase and now stood at £511,509. A profit of £100,234 was c.irried to profit and loss account.
Petrol restrictions and increased cost of car taxation were responsible for a decrease in the income of that department from £1,607,231 in 1938 to £1,573,584 in 1939. Claims paid and outstanding amounted to £887,555 and a profit of £19,882 had been transferred to profit and loss account.
In that account £318,108 was brought forward, while the net ptemiums amounted to £426,899, making a total of £745,007, against which they had settled claims for the year 1939 and previous years amounting to £174,184. Expenses of management, including taxes, amounted to £64,029. After having transferred £25,000 to the profit and loss account, the marine fund stood at £481,793, or 112.85 per cent, of the premium income.
PROFIT AND Loss ACCOUNT
The amount brought forward last year was £402,134. Interest earnings, plus fixed fees and credits from various departments amounted to £608,327, together producing a total on the credit side of £1,010,461. After providing for the dividends, expenses of management not charged to other accounts, taxes, including N.D.C., office equipment, bad debts, and writing off fully an item of £41,748, expenses in connexion with air raid precautions, the balance carried! forward was £493,364. The carry-forward in profit and loss during the last two years had been increased by approximately £20o,000.1 The interest earnings alone more than cover the total dividend.
In order to provide for the depreciation which occurred during the year in the values of securities held by the company, they had trans- ferred £350,000 from their contingencies account to investment reserve, which now stood at £65o,000 and was more than sufficient to provide for the difference between the values at which those securities stood in their books and the market values at the end of the year. The heavy depreciation which had occurred during the last three years had been fully provided for each year without touching their general reserve of 42,500,000.
As was to be expected a large proportion of our staff have been called up for National Service, and doubtless many more will be called up in the near future. This has naturally thrown an increasing burden on the remainder of the staff, but I am glad to say, owing to their willing co-operation, the work of the company has been satisfactorily carried on. (Applause.) At the outbreak of war we decided that those of our staff who were etgaged in full-time National Service should continue to receive from us their full salaries, less their service pay and certain allowances, and we are, of course, holding open their positions for them until the end of the war. (Hear, hear.) I will no: conclude without again expressing my great appreciation of the work which has been accomplished here during the year by our chief executives and officials.
The report and accounts were unanimously adopted.