Insurance Companies Act 1982

Publication Date:January 01, 1982
 
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Insurance Companies Act 1982

1982 CHAPTER 50

An Act to consolidate the Insurance Companies Acts 1974 and 1981.

[28th October 1982]

Be it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

I Restriction on Carrying on Insurance Business

Part I

Restriction on Carrying on Insurance Business

Preliminary

Preliminary

S-1 Classification.

1 Classification.

(1) For the purposes of this Act insurance business is divided into long term business and general business; and—

‘long term business’ means insurance business of any of the classes specified in Schedule 1 to this Act, and

‘general business’ means insurance business of any of the classes specified in Part I of Schedule 2 to this Act.

(2) For the purposes of this Act the effecting and carrying out of a contract whose principal object is within one class of insurance business, but which contains related and subsidiary provisions within another class or classes, shall be taken to constitute the carrying on of insurance business of the first-mentioned class, and no other, if subsection (3) or (4) below applies to the contract.

(3) This subsection applies to a contract whose principal object is within any class of long term business but which contains subsidiary provisions within general business class 1 or 2 if the insurer is authorised under section 3 or 4 below to carry on long term business class I

(4) This subsection applies to a contract whose principal object is within one of the classes of general business but which contains subsidiary provisions within another of those classes not being class 14 or 15.

S-2 Restriction on carrying on insurance business.

2 Restriction on carrying on insurance business.

(1) Subject to the following provisions of this section, no person shall carry on any insurance business in the United Kingdom unless authorised to do so under section 3 or 4 below.

(2) Subsection (1) above shall not apply to insurance business (other than industrial assurance business) carried on—

(a ) by a member of Lloyd's; or

(b ) by a body registered under the enactments relating to friendly societies; or

(c ) by a trade union or employers' association where the insurance business carried on by the union or association is limited to the provision for its members of provident benefits or strike benefits.

In this subsection ‘trade union’ and ‘employers' association’ have (throughout the United Kingdom) the meanings assigned to them by section 28 of the Trade Union and Labour Relations Act 1974 .

(3) Subsection (1) above shall not apply to industrial assurance business carried on by a friendly society registered under the enactments relating to such societies.

(4) Subsection (1) above shall not apply to general business of class 14, 15, 16 or 17 if it is carried on solely in the course of carrying on, and for the purposes of, banking business.

(5) Subsection (1) above shall not apply to general business consisting in the effecting and carrying out, by an insurance company that carries on no other insurance business, of contracts of such descriptions as may be prescribed, being contracts under which the benefits provided by the insurer are exclusively or primarily benefits in kind.

Authorised insurance companies

Authorised insurance companies

S-3 Authorisation by Secretary of State.

3 Authorisation by Secretary of State.

(1) The Secretary of State may authorise a body to carry on in the United Kingdom such of the classes of insurance business specified in Schedule 1 or 2 to this Act, or such parts of those classes, as may be specified in the authorisation.

(2) An authorisation under this section may be restricted to industrial assurance business or to reinsurance business, and a body may not carry on industrial assurance business by virtue of an authorisation under this section unless the authorisation expressly extends to such business.

(3) An authorisation under this section may identify classes or parts of classes of general business by referring to the appropriate groups specified in Part II of Schedule 2 to this Act.

(4) On the issue to a body of an authorisation under this section, any previous authorisation of that body under this section or section 4 below shall lapse.

S-4 Existing insurance companies.

4 Existing insurance companies.

(1) A body that was, immediately before the commencement of this Act, authorised under section 3 or 4 of the Insurance Companies Act 1981 to carry on in the United Kingdom insurance business of a class specified in Schedule 1 or 2 to that Act (or a part of such a class) is authorised to carry on there insurance business of the class identified by the same number in Schedule 1 or 2 to this Act (or that part of such a class).

(2) A body may not carry on industrial assurance business by virtue of this section unless—

(a ) it was carrying on such business immediately before 1st January 1982, or

(b ) it was immediately before the commencement of this Act authorised to carry on such business under section 3 of the Insurance Companies Act 1981.

Applications for authorisation

Applications for authorisation

S-5 Submission of proposals etc.

5 Submission of proposals etc.

(1) The Secretary of State shall not issue an authorisation under section 3 above unless—

(a ) the applicant has submitted to him such proposals as to the manner in which it proposes to carry on business such financial forecasts and such other information as may be required by or in accordance with regulations under this Act, and

(b ) he is satisfied on the basis of that and any other information received by him that the application ought to be granted.

(2) The Secretary of State shall decide an application for an authorisation under section 3 above within six months of receiving the information referred to in subsection (1)(a ) above and if he refuses to issue the authorisation he shall inform the applicant in writing of the reasons for the refusal.

S-6 Combination of long term and general business.

6 Combination of long term and general business.

6. The Secretary of State shall not under section 3 above authorise a body to carry on both long term business and general business unless—

a ) the long term business is restricted to reinsurance, or
b ) the body is at the time the authorisation is issued already lawfully carrying on in the United Kingdom both long term business and general business (in neither case restricted to reinsurance)
S-7 United Kingdom applicants.

7 United Kingdom applicants.

(1) The Secretary of State shall not issue an authorisation under section 3 above to an applicant whose head office is in the United Kingdom unless the applicant is—

(a ) a company as defined in section 455 of the Companies Act 1948 or section 399 of the Companies Act (Northern Ireland) 1960 , or

(b ) a registered society, or

(c ) a body corporate established by royal charter or Act of Parliament and already authorised under section 3 or 4 above to carry on insurance business (though not to the extent proposed in the application).

(2) The Secretary of State shall not issue an authorisation under section 3 above to an applicant whose head office is in the United Kingdom if it has an issued share capital any part of which was issued after the commencement of this section but is not fully paid up.

(3) The Secretary of State shall not issue an authorisation under section 3 above to an applicant whose head office is in the United Kingdom if it appears to the Secretary of State that any director, controller, manager or main agent of the applicant is not a fit and proper person to hold the...

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