NORWICH UNION LIFE INSURANCE SOCIETY
SOUND POSITION
THE 132nd annual general meeting of the Norwich Union Life In- surance Society was held on May 21st at Norwich.
Mr. Ernest Hicks (the President) said that when they met a year ago they were all hoping against hope that the clouds of war which were darkening the sky might be dispersed. It was not to be, and after doing everything in our power to preserve peace the Empire had been compelled to meet the challenge of those who were out for world domination. When war was declared last September immediate consideration had to be given to many problems affecting their busi- ness. There was one important matter which, fortunately, gave them no concern, namely, the general basis on which they valued their liabili- ties. This society had for nearly 4o years maintained its reserves on a 2-1- per cent. net interest earning basis, although when rates of in- terest in the open market were high if they had taken the short view they might have weakened their reserves and would certainly be re- gretting the action today.
For the first time for many years they had to record a decrease in their new business figures, but he thought it would be agreed that a total of over f10,300p00, rpresenting a decrease of only 12 per cent. on their record figure for 1938, was extremely satisfactory in the special circumstances. The mortality experience had again been very favour- able, and the expense ratio was only 13.6 per cent. against 14.3 per cent. for 1938.
Although the market values of Stock Exchange securities were very low as on December 31st last, he was able ao assure members that with their internal reserves the assets as a whole were fully of the value shown in the balance-sheet. Also at the end of last month the depreciation in their Stock Exchange securities had been more thin recovered. All those features in connection with the accounts was extremely satisfactory.
The gross rate of interest over the whole of the assets was £4 14s. :d. per cent., a reduction of only is 5d. per cent. on the 1938 figure. The net rate of interest, £3 18s. Id. per cent., showed a reduction of 4s. 6d. per cent. on the figure of the previous year, due entirely to the large increase in the rate of income-tax. Even now, however, they were able to show a margin of no less than Li 8s. id. per cent. o'.'er the 24 per cent. rate which was used in the valuation of their liabilit
In conclusion, the Chairman said he would like to express a best thanks to the general manager, officials and staff both at head office and all their branches. The report was unanimously adopted.
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