National Post from Toronto, Ontario, Canada • 9

January 13, 1073 The WHA score depends on your view 'Unbelievable9 slash aircraft rate cuts insurance manager Buck Houle was still saying the team was in Ottawa to stay. However, WHA league president Garry Davidson, and club owner Nick i (listed as a Buffalo businessman) say a move is But aside from the Ottawa problem, the WHA is apparently confident that the league can prosper in the years ahead. Despite mounting losses, despite the discouragingly small crowds, none of the owners is apparently ready to What You Don't See In a Behlen Building Is What Makes It Well Worth Looking Into also committed to six games but so far there are no indications the commitment will be extended. At midseason, the WHA's most pressing 1 is clearly to raise attendance across the league generally. But it must also find solutions to ownership of the New York franchise which is now being run by the league.

And the Ottawa franchise has proved far from satisfactory. There is little serious dispute now that the Ottawa franchise will be moved, although as late as last week the team's general trusses. don't see columns you don't see Clear, clean and uncluttered. That's a Behlen Stressed Skin Building. It will give you clear, column-free spans to 300' wide.

That means you plan your interior layout to fit your nothing gets In your way. You get other benefits, too like a finished, maintenance-free roof and an enclosed plus fast, BW 20 years of experience "in the aviation-insurance market. While both brokers and insurers say most of the business they are losing is going primarily to unlicensed insurers, just who these insurers are, and what are directing the business to them seems to be a mystery. When the business is written by insurers riot licensed in Canada, a Canadian company "fronts" for the unlicensed companies. The fronting company issues the policy, collects the premiums, and pays the losses, although it does not actually assume the risk.

The real underwriters are the unlicensed companies, spread all the way from North Korea to Bulgaria, according to some Canadian insurers, The fronting Canadian company normally receives a fee for its services of 5-7 yh of the premium. Wilson of Orion says that about the only way the local insurers could compete with the rates being used by the unlicensed market would be to "calculate what the rate should be, cut it in half, then in half again." Even Reed Shaw Osier Toronto-based insurance broker, which admits to being aggressively after aircraft business, says rates have been cut "unmercifully." P. C. Garralt, a Reed Shaw vice-president, says some underwriters are quoting rates of less than 1 to insure aircraft hulls, while the fire-insurance rate for the hangar in which the aircraft is kept is Garratt stresses, however, that the aviation-insurance business has always been highly cyclical. Robert Clements, a senior vice-president of Marsh McLennan, insurance broker, Toronto, agrees.

"Some underwriters tend to overreact, pushing rates up too high when there are losses and cutting them too low when experience is profitable," Clements says. As Sinclair of Lukis Stewart says, it is anyone's guess how long the rate war will continue. And when it ends, some aircraft owners are likely to be hit with some big premium increases. Meantime, as Wilson of Orion puts it, "they are laughing." president and general manager, Canadian Aviation Insurance Managers Ltd. (CAIM), Montreal, says his company has also lost business.

"We are in an unusual period of cutthroat competition," he says. "It's not economical to write business at the rates some insurers are quoting. This sometimes means we have to part company with some very good friends of ours." One reason the underwriters are-so sensitive to rate cutting is the small pool of available business in Canada. Net written aviation premiums in 1971 totaled only $31 million. "There aren't that many aircraft to insure," says BAIC's Redwood.

"If there was enough business around that would permit a wide spread of risk such as in the case of automobile insurance, it is possible some underwriters could show a profit even when others were making a big loss. But in the aircraft business the losses hit everybody." Despite the small pool of available business, more insurers seem to be interested in getting their share. "More markets appear to be competing for the pool of business," says Peter Power, aviation insurance manager, Macaulay Nicolls, Maitland insurance broker, Vancouver. Power, whose firm now is associated with Tomcn-son, Saunders Toronto-based insurance broker, says he has not seen such severe competition in have to argue trade figures Old and the new in trade Figure! Direction published by Agrtid of How U.S. Conoda figurti million Northbound 9,014 9,486 9,148 Southbound 1 1,092 10,522 10,572 Canadian lurplut 2,008 1,036 1,424 upwards through our playoffs." That averages out at just under 5,000 fans per game over some 468 games.

And, depending on your point of view, that could be regarded as an optimistic sign. But the break-even point, according to WHA spokesman Lee Meade, is about 8,000 a game. Bill Hunter, owner of the Edmonton franchise, put3 the figure at 6,000 to 8,000. On that basis, all of the clubs are losing money, with the exception of New England and possibly the Quebec Nordiques. The New England team has averaged 7,828 a game, and Quebec, 6,932.

The other teams are all below the $,000 level. The remaining Canadian entries in the league are considerably below the figure: Winnipeg averages Alberta and Ottawa 2,197. Based on such attendance figures, those three Canadian cities will lose from $200,000 to over $1,000,000 (in Ottawa). The club owners all say that despite low attendance (and high losses) the league can and will survive. The question remains: for how long? "We're going ahead," says Bill Hunter.

"We knew we'd lose some money this year but then most people said we'd never get this league off the ground. Well we have, and it's going to be successful." League spokesmen in Minneapolis attribute some of the blame for low attendance to arenas in some franchise cities. The St. Paul team last week moved to a new civic centre arena and attendance for the first game shot up to over Average, in the old arena was about 4,500. Edmonton is scheduled to get a new arena next year.

In other cities, the presence of Bobby Hull and the Winnipeg Jets is a 1 1 enough to double the average crowd. A Canadian television contract would also help considerably. At present the league has signed a package with CBS in the U.S. for $150,000 this season, escalating to $1 million in the fifth and last year of the contract. The CBC in Canada is Behltn-Wickes A Subsidiary of The Wlckes Corporation ANNOUNCEMENTS 8x 10 Golof Ptioto from your color negative, transparency, art or print Send for your FREE price list CANADA WIDE SERVICE GALBRAITH REPRODUCTIONS 260 RICHMOND STREET WEST TORONTO ONTARIO M5V 1W5 (416) 364-3338 ANDRE ANDERSON The Mutual Life Assurance Company mentj In the Marketing Division at its my- j- 11 i bolt-together construction.

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HOGG, C.l.U. of Canada announces four appoint-head office in Waterloo, Ontarioi 0 throw in the sponge. At least not in their public pronouncements. As the WHA's Lee Meade told FP this week: "Sure it's been a tough year. But we didn't think it would be easy.

And we'r still hanging in." BEHLEN Bshlen.Wir.kM P.O. Box 957 Brandon, Manitoba 41 FP Of Pleas sand full Information on the Behian Strtssd Skin Building Syilwni, Nam Company-Addreai City -Provinci HAROLD WINTERBURN and Donald R. Robb, Regional Directors Director of Group Sales, Mi Is y. i 5 ,3 rinanci.il Poit I I (Continued from p. 1) to go public.

The team is likely to break even over the season. One million common shares are being offered at $1.50 per share and, according to league spokesmen, the issue is oversubscribed. Ottawa financially the weakest team in the league is reported to lose a week. One of the few certain predictions about the WHA is that the Ottawa franchise will be moved to another city, probably before the season ends, certainly before the 1973-74 season begins. But beyond that, assessing the WHA's first three months depends on your point of view.

The critics argue the league is losing money, by the millions, and that the club owners, in persisting, are simply throwing good money into what has proven a bad gamble. But the owners say the league is as profitable (or at least no more unprofitable) than they had expected in the summer of 1972 when they began drafting players. "If anything we're ahead of schedule," Alberta Oilers president Bill Hunter told FP. "We've done everything we said we'd do. We have national television contracts in Canada and the U.S.

We've drafted NHL superstars. And some of the clubs are breaking even." "We have fulfilled everything we said we would, so far," adds Ben Hatskin, owner of former NHL star Bobby Hull and the Winnipeg Jets. The WHA has also managed almost to eliminate the NHL's player reserve clause. The clause effectively bound an NHL player to one club for the duration of his playing career. Legal activities were preventing some NHL star players from playing in the WHA, until Judge Hig-ginbotham ruled against the clause.

But the critical factor Is attendance at league games. League president, Garry L. Davidson said last week he anticipated a total attendance of 2,500,000 by the end of the season. "We've already seen indications of an attendance rise after Christmas holidays," he says. "It should continue 4 m- (Continued from p.

1) 'British Aviation Insurance (BAIC), Toronto. "You just can't reduce rates while claims are in-' creasing," Redwood says. Even some brokers, who are always on the lookout for better deals for their clients, are concerned about the trend. R. Stewart Sinclair, executive vice-president, Lukis Stewart Price Forbes insurance broker, describes the current round of rate cutting as "unbelievable." Sinclair, who has been closely involved with avia-lion insurance for the past 20 years, says keen competition for business is healthy for all concerned.

He adds, however, that he has never witnessed rate cutting in any branch of insurance to equal that now going on in the aircraft business. "How long it will last is anyone's guess," he says. "When the losses start piling in, however, there will be a day of reckoning. In the long run, no one will benefit, and the only remembrance will be that of the turmoil created." The traditional aircraft underwriters are refusing to match the rates being quoted by some of their competitors even though it is costing them business. Redwood says BAIC's business is off 50.

"It's a tough position to take, but we must base our rates on experience," he says. T. A. Wheatley, vice- Why we won't with U.S. over By Clive Baxter OTTAWA To international statisticians it is as exciting as discovering a cure to some dread disease.

After years of work, Canadian and U.S. officials have found the way to reconcile the trading figures of the two countries. While this may leave most people deeply unmoved, for anyone who has had to deal with the inevitable discrepancies in trade figures between any two countries, it is an important breakthrough. U.S. figures on exports to Canada will at last equal Canadian figures on imports from the U.S.

and vice versa. It makes us the first two countries to have found the answer of how to reconcile international trade statistics, and it should take some of tfielieat off trade arguments between Washington and Ottawa. in working out the new concept, the U.S.-Canadian Trade Statistics Committee made up of officials from both countries used 1D70 figures. Statistics Canada figures for that year had shown Canada with a merchandise trade surplus of $1,036 million. Official U.S.

figures for the same year showed our surplus as million figures that played their full part in setting off the August, 1071, U.S. offensive against its main trading partners. Now that both sides have worked things out, it seems the actual surplus was million. What caused these striking differences? Statistics Canada reports these main causes: Customs valuation in excess of transaction valuation of imports accounted for $130 million on the Canadian side and $400 million in the U.S. Undercounting of exports amounted to $150 million for Canada and $500 million for the U.S.

Other significant differences included the crediting to Canada by the U.S. of grain deliveries for warehousing in Canada pending trinshipments to other countries, and inconsistent U.S. and Canadian treatment of shipments of natural gas, temporary imports and transportation charges. Statisticians in both governments now are setting to work to reconcile 1971 and 1072 trade figures. Meanwhile, other experts in the balance-of-payments field arc being told to study the results of this work and to see if they can be applied in their area.

Also, having accomplished this breakthrough, both Washington and Ottawa are preparing to apply the same formula to their trading figures with their other main partners. void 'Surprise Audits' Don't let business surprises catch ynu off balance. Get The Financial Post for week-by-week coverage of business across the land. In Canada: $12 I year; 3 years $26 Elsewhere: $15 a year; 3 years $35 Puraafors Trans Canadian Cy riers3 Ltd is now Purefater Cyriarq Ltd On January 1st, Trans Canadian Couriers, Ltd. became Purolator Courier, Ltd.

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