§ Mr. EffordTo ask the Chancellor of the Exchequer, pursuant to the letter of 16 July 1997 from the Minister for Trade and Competitiveness in Europe to the hon. Member for Staffordshire, Moorlands (Charlotte Atkins) regarding permanent health insurance schemes for employees, what steps he has taken to monitor the sound and prudent management of such schemes; and if he has found it necessary to take action under the Insurance Companies Act 1982. [82169]
§ Ms HewittNone. In the first instance, the management of such schemes is a matter for the insurers themselves. However, most insurers have undertaken to abide by the Association of British Insurers Codes of Practice.
The statutory regulation of insurance companies aims principally at ensuring that only properly authorised insurers carry on business in the United Kingdom; that there is sound and prudent management; and that there are systems of managerial and financial control sufficient to ensure that an authorised company is able to meet its liabilities to policyholders and potential policyholders. In the performance of the administrative and supervisory tasks contracted out to them by the Treasury, the Financial Services Authority will take account of the criteria of sound and prudent management set out in Schedule 2A of the 1982 Act when reaching a view on the management of an authorised insurance company.