HC Deb 19 July 1967 vol 750 cc2386-90
Mr. Jay

I beg to move Amendment No. 227, in page 53, line 26, to leave out 'life assurance business'.

With this Amendment Amendments Nos. 228, 229, 231, 237, 239 and 302 are associated.

Mr. Speaker

It helps the Chair if it knows these groupings in advance. I have no objection if the House has no objection.

Mr. Jay

The effect of these seven Amendments is to alter the phraseology of the Bill so as to change the term "life assurance business" to "ordinary long-term insurance business" wherever it occurs in the Bill. This change is in accordance with the wishes of the insurance industry and the purpose is to avoid confusion between the general understanding by the industry and the public of the life assurance business, which is in accord with the present definition of that term in the Insurance Companies Act, 1958, and the revised definition in the Bill which expands this class to make it inclusive of the other categories of business which cannot strictly be described as life assurance, namely, capital redemption business and long-term personal accident business.

The length of the text of these Amendments which appears rather considerable on the face of it, is in order to facilitate comprehension of the Bill by moving the references to this class of business to their correct places, as well as to make this change in the phraseology. The practical effect of the Amendments is therefore limited to the change of name.

Mr. Temple

I am glad to confirm that the Life Officers' Association has been consulted on this matter and has informed me that these proposed changes will be helpful. The Association drew one other aspect of the matter to my attention, namely, that if this change were not made from the phraseology in the Bill to "long-term business" its member companies would have to rewrite many of their memorandums of association. To that extent the Amendments have cut out a good many changes which would have been comparatively costly to the assurance companies concerned.

Amendment No. 231 is the substantial Amendment and provides that: In this Part of this Act, 'ordinary long-term insurance business ' means business of any of the following kinds, namely,—

  1. (a) effecting and carrying out contracts of insurance on human life or contracts to pay annuities on human life;
  2. (b) effecting and carrying out contracts of insurance against risks of the persons insured sustaining injury as the result of an accident or of an accident of a specified class or dying as the result of an accident or of an accident of a specified class or becoming 2388 incapacitated in consequence of disease or of disease of a specified class, being contracts that are expressed to be in effect for a period of not less than five years or without limit of time and either are not expressed to be terminable by the insurer before the expiration of five years from the taking effect thereof or are expressed to be so terminable before the expiration of that period only in special circumstances therein mentioned; and
  3. (c) effecting and carrying out contracts of insurance, whether effected by the issue of policies, bonds or endowment certificates or otherwise, whereby, in return for one or more premiums paid to the insurer, a sum or a series of sums is to become payable to the insured in the future, not being such contracts as fall within either of the foregoing paragraphs;
but does not include industrial assurance business. I should like to know why, at the end of the Amendment, it goes out of its way to exclude industrial life assurance business. I had always thought that long-term insurance business was certainly life assurance business and therefore was the same sort of assurance business as was carried out by the industrial life offices.

In this field it is not difficult to get mixed up between industrial life business and ordinary life business. They overlap in some circumstances. I wondered why we had this exclusion.

Mr. Jay

Obviously the hon. Member is still at his best. The answer is that, as he knows, life assurance business is covered by special legislation and therefore it is affected in a special way by these definitions.

Mr. Temple rose—

Mr. Speaker

Order. We are on Report and the hon. Member needs the leave of the House to speak again.

Mr. Temple

If I may—

Mr. Speaker

Order. It is not usual for leave to be given, but in the circumstances I will call the hon. Member. Mr. Temple.

Mr. Temple

I am extremely obliged to you, Mr. Speaker. I think that the right hon. Gentleman made a mistake. He said that this was necessary in ordinary assurance business. He should have said in industrial life assurance, because there is special legislation for industrial life assurance.

4.30 a.m.

Mr. Jay

The phrase which we are introducing is "ordinary long-term insurance business", which includes both industrial and ordinary long-term business.

Amendment agreed to.

Further Amendments made:

No. 228, in page 53, line 38, after first 'business', insert 'ordinary long-term insurance business'.

No. 229, page 54, line 8 leave out subsection (4).—[Mr. Jay.]

Mr. Jay

I beg to move Amendment No. 230, in page 55, line 17, to leave out from second 'risks' to the end of line 18.

This is a matter of definition, to make it clear that the insurance of vehicles transporting other vehicles will be treated as motor vehicle business but that the insurance of the vehicles transported, for instance from manufacture to distribution or to a port, is transport insurance within the marine, aviation and transport insurance business. I hope that that is clear and satisfactory.

Mr. Gresham Cooke

I suppose that this is necessary because one of the vehicles is carrying and the others are for shipment aboard ship.

Mr. Temple

My advice is that, if one vehicle is carried on another, it is not a vehicle. That is reasonable, and I hope that the House can accept it.

Amendment agreed to.

Further Amendment made: Page 55, line 18, at end insert— (6A) In this Part of this Act, 'ordinary long-term insurance business' means business of any of the following kinds, namely,—

  1. (a) effecting and carrying out contracts of insurance on human life or contracts to pay annuities on human life;
  2. (b) effecting and carrying out contracts of insurance against risks of the persons insured sustaining injury as the result of an accident or of an accident of a specified class or dying as the result of an accident or of an accident of a specified class or becoming incapacitated in consequence of disease or of disease of a specified class, being contracts that are expressed to be in effect for a period of not less than five years or without limit of time and either are not expressed to be terminable by the insurer before the expiration of five years from the taking effect thereof or are expressed to be so terminable before the expiration of that 2390 period only in special circumstances therein mentioned; and
  3. (c) effecting and carrying out contracts of insurance, whether effected by the issue of policies, bonds or endowment certificates or otherwise, whereby, in return for one or more premiums paid to the insurer, a sum or a series of sums is to become payable to the insured in the future, not being such contracts as fall within either of the foregoing paragraphs;
but does not include industrial assurance business.—[Mr. Jay.]