§ Mr. BurnsTo ask the Chancellor of the Exchequer whether it remains the Government's policy that Departments and non-departmental public bodies should not normally insure commercially; and whether he will make a statement.
§ Mr. DorrellThe Government have reviewed the question whether Departments and non-departmental public bodies should insure commercially. They have decided to retain the existing general rule that decisions whether to insure with commercial insurance companies should normally be decided on value-for-money grounds. Across the Government as a whole, the cost of paying premiums could be expected to exceed the value of claims met by insurance companies. Use of commercial insurance companies is, therefore, likely to be confined to cases where there are special reasons; for example where insurance in respect of equipment such as boilers is part of an inspection/maintenance services agreement, where large volumes of claims handling work are involved, where evidence of insurance may be needed to obtain prompt medical treatment for employees abroad and, in the case of NDPBs, where there is a legal requirement to insure.