§ Lord Desaiasked Her Majesty's Government:
What steps they intend to take to prevent the dissipation or distancing of the personal funds of former Lloyd's Names who ceased to be members of Lloyd's with the benefit of Equitas reinsurance and who are now subject to regulation by the DTI under Part II of the Insurance Companies Act 1982, and whether other than by maintaining a record of the addresses of such Names they will now ascertain the nature and value of such funds in order to underwrite the contractual liability of such Names towards their policyholders.
§ Lord Simon of HighburyWhere former members of Lloyd's have reinsured their 1992 and prior liabilities with Equitas, any claims from policyholders will be met from the assets which have been transferred to Equitas for that purpose. Where such former members have additionally reinsured all their outstanding liabilities from subsequent years through Lloyd's, it will be for the appropriate ongoing members of Lloyd's to meet relevant claims. Only in the unexpected event of Equitas or, where applicable, Lloyd's, failing to pay such claims in full might there be a call on the personal funds of former Names.
The exercise of the Secretary of State's powers under Part II of the Insurance Companies Act 1982 in relation to former members of Lloyd's must be seen in that context. For the time being, the Secretary of State will maintain a record of the addresses of such former members. However, for so long as the relevant reinsurance arrangements continue in force and the claims against policies underwritten by former members' are being paid in full, I do not consider it necessary for the protection of policyholders for the Secretary of State to impose any further regulatory requirements upon, or take any further action against, former members of the Society.