The Friendly Societies (Activities of a Subsidiary) Order 1995

Explanatory Note

(This note is not part of the Order)

This Order varies Schedule 7 to the Friendly Societies Act 1992 (which relates to the activites which may be carried on by a subsidiary of, or a body jointly controlled by, an incorporated friendly society). Two new activities are added, personal deposit taking and personal lines general insurance. The activity set out in paragraph 10 of providing administrative services to friendly societies or other bodies whose business consists of any activity falling within the other paragraphs of Schedule 7 is extended so that such services may be provided to a body whose business consists of an activity falling within the new paragraphs.

Paragraph 11 enables a subsidiary or jointly controlled body of a friendly society to carry on as its object deposit-taking business, as defined in the Banking Act 1987. That part of the business consisting of taking deposits, or lending money, is restricted to dealing with individuals.

Paragraph 12 enables a subsidiary or jointly controlled body of a friendly society to carry on as its object general insurance business as defined in the Insurance Companies Act 1982. That part of the business consisting of effecting and carrying out contracts of general insurance is restricted to contracts which are affected with individuals. This enables a contract to be effected with an individual and for the right to payment under that contract to be assigned to a body corporate or for a transfer of an engagement to be accepted where the contract was effected with an individual.

Subsidiaries which carry on these activities are required to be authorised under the relevant legislation to conduct the activity.

A compliance cost assessment of the effect that this instrument would have on the cost of business in available from:

The Secretary

Friendly Societies Commission

15 Great Marlborough St

London W1V 2LL