§ Mr. WallerTo ask the President of the Board of Trade when he intends to amend the Policyholders Protection Act 1975; and if he will make a statement. [12542]
§ Mr. NelsonMy right hon. Friend the President of the Board of Trade announced his intention to amend the Policyholders Protection Act 1975 on 23 October 1995,Official Report, column 417, as soon as Parliamentary time permitted. My hon. Friend the Member for Bournemouth, West (Mr. Butterfill) has now introduced a Bill which implements all but one of the Government's proposals to amend this Act. The Bill is due to receive its Second Reading on Friday 24 January. The Government fully support the Bill.
640WThe main objectives of the Bill are to amend the geographic coverage of the 1975 Act by excluding insurance risks outside the European Economic Area from the compensation scheme; to modernise its provisions in relation to the failure of non-life insurance companies; and to change some administrative procedures designed to speed up settlement of claims against insolvent insurance companies.
The Bill also includes a proposal explicitly to extend the Act's compensation scheme to insurance policies issued by branches of United Kingdom companies in the Channel islands and Isle of Man covering risks in those territories. Hitherto, there has been some legal doubt about whether this business was covered.
The Bill proposed by my hon. Friend the Member for Bournemouth, West does not include the Government's proposal to limit partnership benefits to those provided to incorporated bodies in the Policyholders Protection Act 1975. The Government intend to review this proposal.