CERTIFICATES OF INSURANCE (Hansard, 11 July 1969)

§ Mr. David Watkins
I beg to move Amendment No. 5, in page 2, line 36, leave out from beginning to ' shall ' in line 11 on page 3 and insert: (1) Provision may be made by regulations for securing that certificates of insurance in such form and containing such particulars as may be prescribed by the regulations, are issued by insurers to employers entering into contracts of insurance in accordance with the requirements of this Act and for the surrender in such circumstances as may be so prescribed on certificate so issued. 1802 (2) Where a certificate of insurance is required to be issued to an employer in accordance with regulations under subsection (1) above, the employer (subject to any provision made by the regulations as to the surrender of the certificate).

§ Mr. Speaker
I suggest that it would be convenient for the House to discuss at the same time Amendments Nos. 6, 7, 8 and 9.

§ Mr. Watkins
That is convenient, Mr. Speaker, since if Amendment No. 5 is accepted the remainder become consequential.
This group of Amendments deals with an important issue in the Bill. Its effect is to simplify the provisions concerning certificates of insurance. As the Bill is drafted, an employer will not satisfy the requirement to insure until the certificate has been delivered to him. The new subsection (I) substitutes the simple requirement that the insurer shall issue a certificate. The form of the certificate and other requirements are to be specified in regulations.
While Amendments Nos. 6 to 9 are consequential, they raise two points of substance. The first is that they dispense with the requirement for a statutory declaration by an employer who has lost or destroyed a certificate. This is at present contained in subsection (2). The second is that regulations can require an employer to permit the inspection of the policy, as an additional safeguard; that is, in addition to the certificate being provided.
This change represents another major simplification of the Bill. It also attempts what I might call a compromise between the view of certain insurers, who would like to see the certification requirement dropped, and my view, which I expressed in Committee. I believe that certification must remain because, for the purposes of enforcement, it is vital that trade union officials and factory inspectors should be able to see proof of insurance on demand. This point of view was, generally speaking, accepted in Committee.
As I have indicated, there are certain misgivings in the insurance market about this matter, on which lengthy discussions have taken place. I met representatives of the insurance market, and one of the points they made was their desire to see the onus to provide a certificate put 1803 on the employer and not on the insurance company. After careful consideration and due consultation, I felt that I could not go as far as that; but the Amendment goes a long way towards simplifying the whole procedure and ironing out many of the difficulties of the insurance companies and the enforcement of the Bill.
It is not intended that the certification requirements should be so onerous as to upset the present working of the insurance arrangements, or that they should involve the payment of extra premiums by employers who are already voluntarily complying with the aims of the Bill; and I recognise that the majority of employers are probably doing so.
2.45 p.m.
In many occupations the insurance cover needed may vary not only from week to week but from day to day. I have ascertained that it is a common practice for an employer to find, due to the nature of his work, that the cover he requires is liable to change rapidly. For example, in the construction industry workers may be digging a trench 3 ft. deep at one stage and switch to digging a trench 6 ft. deep at another. Cover is then required in view of the danger of people falling into the trench or articles being dropped on people.
In these circumstances—the same can be said of other industries—it is normal practice for the insurance company to be telephoned, for the precise nature of the work to be explained and for the necessary extra cover to be given. The risk is immediately accepted and the employer is covered, with the premiums being adjusted retrospectively.
Without the Amendment, adequate cover in these cases could not be obtained until a certificate had been delivered; and many of the employer's operations might, in the interim, be brought to a halt. His only alternative might be to pay a much higher premium to cover all sorts of risk, many of which he might seldom need—a burden that I would not wish to place on employers.
The regulation-making power in the Clause, with the Amendment, will remain comprehensive and will enable any form of certification which is found to be desirable to be obtained. In other words, the question of a simple form of certification will be fully covered. The 1804 power to require a certificate to be displayed will remain, and this will be backed up by the power to require an employer to produce the policy, should this be necessary; in other words, should it be impracticable to incorporate all the necessary information in certificates. It follows from what I have said that it may be impracticable to include all the detailed information which would be required in certificates, and the Amendment caters for this eventuality.
As I said at the outset, I recognise that the Amendment deals with a major matter. I have had the assistance of the Department and Parliamentary draftsmen in formulating the Amendment, which I trust hon. Members will find acceptable.

§ Mr. David Mitchell
While I accept the need for the Amendment, there is an important matter on which we should be clear. At what stage will the procedure for certification operate? There may be cases of employers taking on people—we can return to the question of who will be covered—who will want an assurance that they are covered by an insurance policy. Thus, the question of when the certificate must be displayed needs clarification.

§ Mr. David Watkins
It is intended that there will be consultations with all concerned about this matter. I realise that the point at which a certificate must be displayed is a nice one. In the light of the consultations I have had with insurance companies, I am prepared to use an old phrase and say that an insurance firm's word is as good as its bond. While there may be difficulties in supplying certificates immediately, or within, say, an hour's notice, once a contract has been entered into I am sure that it will be honoured.