§ [No. 63]
Schedule 1, page 41, line 3, at end insert—
(c) in paragraph (c) for the words 'consider whether or not they should exercise with respect to the body' there shall be substituted the word 'exercise'".
§ 6.20 p.m.
§ THE EARL OF LIMERICK
My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 63. This is a somewhat technical Amendment. The Department's present powers of inspection of the books and 1603 papers of an insurance company are contained in Part III (Section 109) of the 1967 Act which relates to all types of companies. In Schedule 2 the Bill will repeal Section 109(1)(f) which applies these powers to any body, incorporated or not, which falls within the definition of an insurance company contained in the 1958 Act, since Clause 20(2) provides specifically, and in some respects differently, for such companies. Since the Bill was drafted there has been a case in which a non-insurance company which was an associate of an insurance company was the subject of an investigation under Section 109 which brought to light doubts about the fitness of some of the directors of the insurance company. Section 111(1)(c) as it stands would not allow the Department to quote to the associate insurance company without the permission of the investigated company particulars of the unfitness revealed by that inspection. Such permission might well be withheld and it would then be impossible to give particulars of the unfitness required when action is contemplated under Clauses 22 and 23 in respect of a sitting tenant.
This Amendment would remove the difficulty. The position would be the same if the power of investigation under Clause 20(2) were used after the Bill comes into force, since Section 111(1) of the 1967 Act is applied to that clause by paragraph 16 in Schedule 1. Were the Amendment not made, it would be difficult, and in some cases impossible, to act on information in investigating one company in order to protect the policyholders of another, without first conducting a separate investigation into the second company. Not only would that waste time, but also it might fail to uncover separate evidence—for example, as to the unfitness of a person associated with both companies—and the Department would then be effectively baulked in its inquiries. I beg to move.
§ Moved, That this House doth agree with the Commons in the said Amendment.—(The Earl of Limerick.)