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Thursday, 10 July 1930

Senator RAE (New South Wales) . - I am exceedingly sorry that the bill has been passed by the Senate in its present form because I consider it to be very defective in many respects, and I can only hope that the more democraticallyminded members of another place will insist upon amendments which failed to receive the acceptance of honorable senators in this chamber. I am surprised that a bill of this character should have been entrusted to a private member, and particularly one who is closely associated with insurance business. It seems to me that it has failed in almost every respect to be any advance on the reactionary legislation passed by the various State Parliaments. Senator McLachlan, in the course of the numberless speeches which he made during the debate in the committee stages, told us that it contains the best portions of existing State legislation, and that in its present form it is worthy of general acceptance. I absolutely dissent from that statement. In the first place the bill contains no provision guaranteeing that there will be an honest audit of the balancesheets of the various insurance companies. The industrial section is, in my opinion, scandalous, and there is no provision requiring companies to disclose what amount is absorbed by those who constitute the directorate of the various insurance companies. I consider the measure to be quite reactionary in its terms and believe it is not calculated to fit in with the spirit of the times. I am looking forward to the day when all forms of insurance will become a State monopoly. But until we reach that objective, we should at least pass legislation giving some guarantee to insured persons that they will receive a fair and honest deal at the hands of the various companies. In this respect this bill fails utterly. What reason is there for the omission of a provision relating to the surrender value of industrial policies? Then, again, why should not the fees paid to members of directorates as well as all allowances, travelling expenses, &c, be stated in a separate item in the balance-sheets ? Policy-holders would then know who are living on the game, as many are doing, at the expense of widows and orphans, for whom insurance protection is primarily intended. Widows and orphans are continually being misled by the fake methods adopted to secure business. Even one leading insurance company, which is supposed to be sacrosanct - I refer to the Australian Mutual Provident Society - adopts most unfair tactics. It inserted advertisements in the Sydney Morning Herald, and probably in other newspapers, not only in New South Wales, but also in the other States, inviting prospective insurers, towards the end of the society's financial year, to take out insurance policies so as to enjoy the benefits of the current year's bonus.

This, of course, is impossible, because the rules of the society distinctly provide that no bonus is payable on any policy less than two years old. Even if the insured person dies within that period, the bonus is not added to the policy. This society, as honorable senators well know, is regarded as a model institution, and yet it descends to such mean tactics to obtain new business. I am particularly interested in the industrial side of life insurance, and I know that in numberless instances the wife or daughter in a household is beguiled to take out policies by glib-tongued life insurance canvassers, who promise all sorts of fancy benefits, and often they discover, even before the policy is due, that owing to some technicality they :have thrown their money away. At the best, industrial insurance is necessarily a poor kind of provision, because the greater part of the premium payments is swallowed up in overhead expenses. Nevertheless, companies beguile innocent and ignorant people to take out policies which are not worth their face value. We have done nothing to prevent that state of affairs in the future. The honorable senator in charge of the bill has been so averse to accepting any amendments whatever in his pet bill, that it was only with the utmost difficulty that we secured a number of trivial alterations, which the common sense of other honorable senators forced him to accept most reluctantly. This bill is, in my opinion, a disgrace to the Senate. I trust, however, that when it is being discussed in another place amendments will be insisted upon by the more liberal minded members of that chamber, and that when it is returned to the Senate its sponsor in this chamber will not know it.

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