It has now become very generally recognized, I think, that finance is decidedly the most important factor in the conduct of life assurance business. This subject does not appear to have received, in earlier times, the intensive study which its significance deserved; latterly, however, it has attracted steadily increasing attention and now occupies a very prominent position in the transactions of our Institute.

It is probably true to say that in accordance with a fairly generally accepted principle the investment programme during recent years has been largely confined to securities of what may be called the “semi-trustee” type, i.e., those which are cheaper than statutory trustee securities though not very greatly inferior in quality. Usually a small proportion only of the programme has been devoted to a rather limited range of 2nd grade or high-yielding investments, and in our discussions at the Students' Society comparatively little has been said about these. I propose, therefore, in the present paper to state the case in favour of this latter type of security and to put forward the suggestion that the time has arrived when a quite considerable proportion of our new investments might with advantage be selected from this category.

For some time past there has been a large amount of business transacted by Life Insurance Companies under what is commonly known as the “Super Tax Saving Scheme.”

A person who is liable for super tax effects with an insurance company a whole life or endowment assurance with or without profits by a single premium. The company then advances a large proportion of the single premium to the assured on the security of a first charge on the policy and bonuses, if any.

An office transacting life assurance relies for its results on the law of averages as revealed by investigation into past experience. Statistics are compiled in order that an estimate of future mortality may be obtained, and i f each assurance accepted were for the same amount, the office could, if it wished, retain for its own account all its business. In practice proposals are received for amounts ranging from the smallest sum for which the company will issue a policy up to hundreds of thousands of pounds, and clearly as the bulk of the business is for small sums assured an office might experience violent fluctuations in financial results if it retained the whole of the large proposals, even if the mortality experience were according to expectations and consistent from year to year.

The superannuation of the employees of local authorities has not, so far as I am aware, been discussed by this Society. The recent publication of a report by a Departmental Committee which was appointed to enquire into the working of the Local Government and other officers Superannuation Act 1922, has drawn attention to the subject, and, in addition to this, it will be remembered that the first quinquennial valuation of the earlier funds established under the Act of 1922 will shortly have to be made. Apart altogether, therefore, from the Committee's recommendations, actuarial activities in this direction are likely to be fairly extensive in the near future.

Under the heading group insurance may be included all types of insurance contract whereby a number of persons are by one policy covered against a given risk. In present day practice, however, its use is chiefly confined to the one special policy under which the lives of a group of persons—usually a firm's employees— are assured on a One Year Renewable Term basis, usually without medical examination.

Group insurance in this form originated in America and has proved extremely popular both in that country and in Canada. In this country it has not received so warm a welcome and it is only within recent years that British offices have given it their serious attention.