Insurance Act , 1989

PART I Preliminary and General

1 Short title, collective citation, construction and commencement.

1.—(1) This Act may be cited as the Insurance Act, 1989.

(2) The Insurance Acts, 1909 to 1985, and this Act may be cited together as the Insurance Acts, 1909 to 1989, and shall be construed together as one Act.

(3) This Act shall come into operation on such day or days as may be appointed by order or orders of the Minister, either generally or with reference to a particular purpose or provision, and different days may be so appointed for different purposes and different provisions of this Act.

2 Interpretation.

2.—(1) In this Act, except where the context otherwise requires—

“authorisation” means an authorisation issued by the Minister under the Regulations of 1976 or the Regulations of 1984 to carry on a specified class or description of insurance business;

“authorised agent” in relation to an undertaking means the person designated as authorised agent of the undertaking under the Regulations of 1976 or the Regulations of 1984;

“business” means assurance or insurance business;

“client” means a person who requests an insurance intermediary to arrange insurance on his behalf;

“commission payment” has the meaning given to it by subsection (3);

“the Companies Acts” means the Companies Act, 1963, and any enactment which is to be construed together with it;

“contravention” in relation to any provision of this Act includes failure to comply with any requirement imposed by or under that provision and “contravene” shall be construed accordingly;

“Council Directive” means a Directive of the Council of the European Communities;

“the Court” means the High Court;

“insurance” includes assurance;

“the Insurance Acts” means the Insurance Acts, 1909 to 1989, and regulations relating to insurance business made under the European Communities Act, 1972;

“insurance agent” means any person who holds an appointment in writing from an insurer enabling him to place insurance business with that insurer, but does not include an insurance broker or an employee of an insurer when the employee is acting for that insurer;

“insurance broker” means a person who, acting with the freedom of choice described in section 44 (1) (b), brings together, with a view to the insurance of risks, persons seeking insurance and insurance undertakings, and carries out work preparatory to the conclusion of contracts of insurance, but does not include an insurance agent or an employee of an insurer when the employee is acting for that insurer;

“insurance intermediary” or “intermediary” means an insurance agent or an insurance broker;

“insurer” means the holder of an authorisation under the Regulations of 1976 or the Regulations of 1984;

“life assurance” means assurance of a class specified in Schedule 1 to the Regulations of 1984;

“non-life insurance” means insurance of a class specified in Schedule 1 to the Regulations of 1976;

“the Minister” means the Minister for Industry and Commerce;

“prescribe” means prescribe by regulations made under this Act;

“regulations” means regulations made under the Insurance Acts, 1909 to 1989, and regulations relating to insurance business made under the European Communities Act, 1972;

“the Regulations of 1976” means the European Communities (Non-Life Insurance) Regulations, 1976 (S.I. No. 115 of 1976);

“the Regulations of 1984” means the European Communities (Life Assurance) Regulations, 1984 (S.I. No. 57 of 1984);

“solvency certificate” means a certificate issued by the Minister to an undertaking attesting its compliance with the solvency requirements specified in the Regulations of 1976 or the Regulations of 1984 as appropriate;

“supervisory authority” means, in respect of any territory, the authority charged by law with the duty of supervising the activities of insurance undertakings in that territory;

“undertaking” means the holder of an authorisation.

(2) References in the Insurance Acts, 1909 to 1989, to “assurance company” or “insurance company” shall be construed as references to the holder of an authorisation, and references to “licence” shall be construed as references to “authorisation”.

(3) (a) A commission payment, for the purpose of this Act, is a payment, including a commission or other remuneration, reward or benefit in kind, paid or payable by or on behalf of the holder of an authorisation to an insurance intermediary in connection with the insurance business of the holder and includes the time allowed by the holder to the intermediary for the payment by the intermediary to the holder of premiums received by the intermediary for the holder for contracts of insurance entered into by the holder.

(b) The value of the time allowed by an intermediary for the payment of a commission is to be taken into account in the calculation of the value of the time so allowed by the holder.

(4) In this Act a reference to a Part, section or Schedule is to a Part or section of this Act or to a Schedule to this Act, unless it is indicated that reference to some other enactment is intended.

(5) In this Act a reference to a subsection or paragraph is to the subsection or paragraph of the provision in which the reference occurs, unless it is indicated that reference to some other provision is intended.

3 Offences and penalties.

3.— (1) Every person who contravenes a provision of this Act shall be guilty of an offence.

(2) Every person who is guilty of an offence under this Act shall be liable—

(a) on summary conviction, to a fine not exceeding £1,000 or imprisonment for a term not exceeding six months or both;

(b) on conviction on indictment, to a fine not exceeding £10,000 or imprisonment for a term not exceeding three years or both.

(3) Where an offence under this Act is committed by a body corporate and the offence is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, any director, manager, secretary or other similar officer of the body or any person who was purporting to act in such capacity, he, as well as the body, shall be guilty of the offence and shall be liable to be proceeded against and punished accordingly.

(4) A person convicted of an offence for which a penalty is provided in a provision, mentioned in column (2) of the Second Schedule, of an Act specified in column (1) of that Schedule, shall, in lieu of being liable to the penalty provided in that provision, be liable to the penalty specified in column (3) of that Schedule opposite the mention of that provision in column (2).

(5) If any person in any return, report, certificate or other document required for the purpose of any provision of this Act, or in any application to the Minister for an authorisation, wilfully makes a statement false in any material particular, knowing it to be false, he shall be guilty of an offence.

(6) The provisions of this section are without prejudice to section 109 of the Insurance Act, 1936 (which as adapted by section 2 (2) of this Act relates to offences by the holder of an authorisation) and references to “this Act” in subsections (1) and (4) of the said section 109 shall be construed as references to the Insurance Acts.

4 Service of documents.

4.—Any notice, requisition, direction or other document which is required or authorised to be served on a person by this Act may be served—

(a) in the case of a company incorporated or society registered in the State, by leaving it at, or sending it by pre-paid ordinary post to, the registered office of the company or society,

(b) in the case of a company incorporated outside the State but having a place of business in the State, by leaving it with, or sending it by pre-paid ordinary post to, the person notified to the Minister under the Insurance Acts as the authorised agent in the State of the company or, if no such person has been notified to the Minister, by the method specified in section 356 of the Companies Act, 1963,

(c) in the case of a foreign registered society with a place of business in the State, by leaving it with, or sending it by pre-paid ordinary post to, the person notified to the Minister under the Insurance Acts as the authorised agent in the State of the society or, if no such person has been notified to the Minister, by leaving it at or sending it in the manner aforesaid to the place of business of the society in the State,

(d) in the case of Lloyd's, by leaving it with, or sending it by pre-paid ordinary post to, the person notified to the Minister under the Insurance Acts as the authorised agent of Lloyd's in the State,

(e) in the case of any other person, by leaving it at, or sending it by pre-paid ordinary post to, that person's last known address.

5 Power to make regulations.

5.—(1) The Minister may make regulations for enabling this Act to have full effect.

(2) Regulations under this Act may contain such incidental, supplementary and consequential provisions as appear to the Minister to be expedient for any purpose of this Act.

6 Orders.

6.—The Minister may by order revoke or amend any order made by him under any provision of this Act other than an order made under section 1 (3).

7 Fees.

7.—(1) The Minister, with the consent of the Minister for Finance, may by order provide for fees—

(a) to be paid to him annually by the holders of authorisations,

(b) to be paid to him in respect of the issue of a solvency certificate.

(2) The fee for inspection of the register kept under section 21 of the Insurance Act, 1936 shall be such fee not exceeding ten pounds as the Minister with the consent of the Minister for Finance shall from time to time direct and subsection (5) of that section is hereby amended accordingly.

(3) The fees to be paid under this Act shall be collected in money and taken in such manner as the Minister for Finance may from time to time direct, and shall be paid into or disposed of for the benefit of the Exchequer in accordance with the directions of that Minister.

(4) The Public Offices Fees Act, 1879 shall not apply in respect of fees under this Act.

8 Laying of orders and regulations before Houses of Oireachtas.

8.—Every order or regulation made by the Minister under this Act shall be laid before each House of the Oireachtas as soon as may be after it is made and, if a resolution annulling the order or regulation is passed by either such House within the next twenty-one days on which that House has sat after the order or regulation is laid before it, the order or regulation shall be annulled accordingly, but without prejudice to the validity of anything previously done thereunder.

9 Repeals.

9.—Each enactment mentioned in column (2) of the First Schedule is repealed to the extent specified in column (3) of that Schedule opposite the mention of that enactment in column (2).

10 Expenses.

10.—The expenses incurred by the Minister in the administration of this Act shall, to such extent as may be sanctioned by the Minister for Finance, be paid out of moneys provided by the Oireachtas.

PART II Supervision of Insurers

11 Submission and publication of returns and documents by insurers.

11.—(1) The Minister may by regulation—

(a) prescribe the returns and documents to be submitted by holders of authorisations,

(b) require any return or document submitted to him to be attested by a person of professional standing specified by the Minister, and by directors and such officers of the company as he may prescribe,

(c) require that any such return or document shall be published in such manner as the Minister sees fit and that any return or document shall be laid before each House of the Oireachtas.

(2) The Minister shall have the right to disclose any such return or document to the supervisory authority of another Member State of the European Communities, where such disclosure is required or authorised by law.

12 Regulations regarding reserves liabilities, valuation of assets, reinsurance cessions and solvency certificates.

12.—The Minister may make regulations for the proper exercise of his functions under the Insurance Acts in respect of the following—

(a) the calculation of technical or mathematical reserves representing underwriting liabilities,

(b) the valuation of assets of an insurance undertaking,

(c) the nature and spread of assets representing underwriting liabilities and the localisation and matching of such assets,

(d) the calculation of underwriting liabilities,

(e) reinsurance cessions of authorised undertakings including information which undertakings must supply in respect of their reinsurance arrangements,

(f) the procedure, conditions and forms to be involved in the issue of a solvency certificate,

(g) the prohibition or limitation of investments of a specified class or description,

(h) the percentage of distributed surplus allocated to policyholders.

13 Keeping of records by undertakings.

13.—An undertaking shall maintain at its registered office or place of business in the State proper records of all business carried on by the undertaking in the State under its authorisation.

14 Separation of assets and liabilities attributable to life assurance business.

14.—(1) Every undertaking authorised to carry on life assurance business—

(a) shall maintain an account in respect of that business and the receipts of that business shall be entered in the account maintained for that purpose and shall be carried to and form the life assurance fund, and

(b) shall maintain such accounting and other records as are necessary for identifying—

(i) the assets representing the fund maintained by the undertaking under paragraph (a) of this subsection, and

(ii) the liabilities attributable to that business.

(2) The provisions of subsection (1) are without prejudice to the obligations of an undertaking to maintain such records as are necessary for the preparation and submission to the Minister of separate accounts and statements for any class or part of a class of business as required from time to time by the Insurance Acts.

15 Application of assets of undertaking transacting life assurance business.

15.—(1) The assets representing the fund maintained by an undertaking in accordance with section 14 (1)—

(a) shall be applied for the purposes of that business, and

(b) shall not be transferred so as to be available for other purposes of the undertaking except where the transfer constitutes reimbursement of expenditure borne by other assets (in the same or the last preceding financial year) in discharging liabilities wholly or partly attributable to life assurance business.

(2) Where the value of the assets mentioned in subsection (1) is shown, by an investigation to which Article 5 of the European Communities (Life Assurance Accounts, Statements and Valuations) Regulations, 1986 (S.I. No. 437 of 1986) applies or which is made in pursuance of a requirement imposed under section 16 or 17 to exceed the amount of the liability attributable to the undertaking's life assurance business the restriction imposed by that subsection shall not apply to so much of those assets as represents the excess.

(3) Subsection (2) shall not authorise a transfer or other application of assets by reference to an actuarial investigation at any time after the date when the abstract of the actuary's report of the investigation has been deposited with the Minister in accordance with Article 9 (1) of the said Regulations of 1986.

(4) Nothing in subsection (1) shall preclude an undertaking from exchanging, at fair market value, assets representing the fund maintained by the undertaking in respect of its life assurance business for other assets of the undertaking.

(5) A mortgage or charge shall be void to the extent to which it contravenes subsection (1).

(6) Money from the fund maintained by an undertaking in respect of its life assurance business shall not be used for the purposes of any business of the undertaking which is not life assurance business notwithstanding any arrangement for its subsequent repayment out of the receipts of that other business.

(7) No undertaking to which this section applies shall declare a dividend at any time when the value of the assets representing the fund or the solvency margin, as determined in accordance with any applicable valuation regulations, is—

(a) in the case of the fund, less than the amount of the liabilities attributable to that business as so determined, or

(b) in the case of the solvency margin, less than the amount required by the Regulations of 1984.

(8) In this section a reference to “the fund” is to the total fund of assets maintained by an undertaking in respect of its life assurance business, not being shareholders' assets.

16 General powers to require information.

16.—(1) Whenever the Minister considers it necessary in order to satisfy himself whether an undertaking is complying with its obligations under the Insurance Acts he may require the undertaking to prepare and submit to him—

(a) returns and accounts in the form prescribed by the Insurance Acts made up to such date as the Minister may direct;

(b) such other information (including information derived from an actuarial investigation) as he may specify in relation to the undertaking itself;

(c) such other information as the Minister may specify in relation to any connected body of the undertaking which the undertaking may reasonably be expected to provide.

(2) The Minister may require that such returns, accounts or information be certified or attested as to their correctness by any person nominated by him.

(3) For the purpose of this section a connected body shall include—

(a) any connected body within the meaning of section 4 (4), paragraphs (a), (b) and (d) of the Insurance (No. 2) Act, 1983,

(b) any body in which the undertaking, either alone or with any associate or associates, is entitled to exercise or control the exercise of one-fifth or more of the voting rights at any general meeting of that body,

(c) any body which, either alone or with any associate or associates, is entitled to exercise or control the exercise of one-fifth or more of the voting rights at any general meeting of the undertaking,

(d) any body which is a fellow subsidiary of the undertaking within the meaning of the Companies Acts, and

(e) any body which is connected to a connected body within the meaning of this section.