The Insurance Companies Act 1981 and Some of the Associated Regulations

Extract

The Insurance Companies Act 1981, after a relatively uncontroversial passage through both Houses of Parliament, received the Royal Assent on 2 July 1981. The main purposes of the Act were:

(a) to implement the provisions of the E.E.C. Life Directive of 5 March 1979,

(b) to enact in primary legislation the provisions of the E.E.C. Non-Life Directive dated 24 July 1973 (the provisions of this directive had already been implemented by statutory instruments under the European Communities Act 1972), and

(c) to remedy some defects in the Insurance Companies Act 1974 which had come to light in the course of day-to-day supervision, and to make other changes consequent on the implementing of the directives. Changes of particular interest to actuaries include:

(i) a requirement for annual actuarial investigations,

(ii) where any rights of long-term policyholders to participate in profits relate to the profits of particular parts of a long-term fund, a requirement to determine a separate surplus for that sub-fund,

(iii) some closing of loopholes in the requirement that no transfers out of the long-term fund should be made without an actuarial valuation and without meeting the conditions of §25 of the 1974 Act.