H.—B.

ACTUARY'S REPORT ON THE VALUATION OP THE GOVERNMENT INSURANCE DEPARTMENT AS AT 31st DECEMBER, 1926.

Presented to both Rouses of the General Assembly pursuant to Section 40 of the Government Life Insurance Act, 1908.

Government Actuary's Department, Wellington, 31st March, 1927. I have the honour to report that, in compliance with section 40 of the Government Life Insurance Act, 1908, and its amendments, I have made a valuation as at the 31st December last of the actuarial liabilities of the Government Insurance Department, with the object of ascertaining the net surplus available for division amongst the policyholders. Progress of the Department. The progress of the Department during the last three years when compared with the three previous trienniums, in respect of new business and total business in force, is as follows :—

Consolidated Revenue Account.

Income—On the income side the chief items of importance are the increase of £192,778 in the total premium income, and the revenue from interest, which exceeds by £153,989 the interest earnings of the previous triennium. The net effective rate of interest credited to the funds each year for the past six years has been as follows Rate of Interest (after Deduction of Taxes from Interest). £ s. ii. £ s. d. 1921 ... ... ... 5 3 5 1924 ... ... ... 5 7 7 1922 ... ... ... 5 3 11 1925 ... ... ... 5 9 1 1923 ... ... ... 5 6 8 1926 ... ... ... 5 11 1 Outgo. —The death claims of the triennium were £16,906 heavier than in the previous triennium, while the sum paid to the holders of endowment assurance or endowment policies who survived the selected terms amounted to £718,407, an increase of no less than £65,112 over the previous triennium. The Valuation. The business to be valued consisted of 65,396 policies, assuring £20,218,403, inclusive of bonus additions, and £24,997 immediate and deferred annuities per annum, the ordinary annual premiums thereon amounting to £573,319. The Department also receives £2,100 per annum representing additions to the tabular premiums. These extra premiums are assumed to cover the current year's extra risk, and are not brought into the valuation as an asset.

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New Business of Triennium. In Force at End of Triennium. Triennimn. , | Number of Sums , Annual , Number of Sums Reversionary Annual Policies. assured. | Premiums. | Policies, j assured. Bonuses. Premiums. I I £ =2 £ £ £ 1915-1917 .. 10,129 2,709,163 1 90,017 ! 53,058 12,884,531 1,304,243 387,377 1918-1920 .. 14,189 4,529,993 156,568 j 57,321 14,924,147 1,335,163 449,123 1921-1923 .. 13,537 4,499,581 139,620 ! 60,545 16,549,451 1,357,161 501,321 1924-1926 .. 16,689 , 5,512,560 175,757 j 65,396 18,743,397 1,475,007 575,420 The Consolidated Revenue Account, given below, shows the total income and expenditure for the last three years, and the growth of the funds of the Department during the triennium.

Triennium ending 31st December, 1926. ; TrfenniSm Triennium ending 31st December, 1926. GMemSSm [ J [J £ I £ £ £ Funds at beginning of tri- 6,2-22,485 5,542,552 Death claims .. .. 547,896 530,990 ennium j Matured claims .. .. 718,407 653,295 Renewal premiums .. 1,438,733 1,291,437 Annuities paid .. .. 64,904 62,838 , New premiums .. .. 176,660 131,178 Surrenders .. .. 252,426 195,036 Consideration for annuities 47,835 31,772 Bonuses surrendered for cash 18,293 19,546 Interest, less taxes .. 1,053,408 894,419 Commission .. .. 118,929 99,852 Defalcations recovered .. .. 267 Expenses .. .. 178,682 180,728 j Transfer from Investment .. 75,788 Transfer to Investment 10,000 ] Fluctuation Reserve Fluctuation Reserve } Marryatt Defalcation Ac- .. 2,643 count Funds at end of triennium.. 7,029,584 6,222,485 Totals .. .. £8,939,121 £7,967,413 Totals .. .. £8,939,121 £7,967,413 )