The Insurance Companies (Overseas Life Assurance Business) (Compliance) (Amendment) Regulations 1999

Explanatory Note

(This note is not part of the Regulations)

These Regulations amend the Insurance Companies (Overseas Life Assurance Business) (Compliance) Regulations 1995 (“the principal Regulations”).

Regulation 1 provides for citation, commencement and effect, and regulation 2 for interpretation.

Regulation 3 inserts various definitions in regulation 2 of the principal Regulations.

Regulation 4 repeals regulations 3, 17 and 20 of the principal Regulations.

Regulation 5 amends regulation 5 of the principal Regulations (overseas branch business) so as to make provision for transfers of insurance business from non-UK insurance companies to UK insurance companies and also to provide that overseas branch business, not being term assurance business, is overseas life assurance business unless the insurance company completes a prescribed certificate.

Regulation 6 amends regulation 7 of the principal Regulations (overseas direct services business) so as to cater for transfers of insurance business from non-UK insurance companies and also to limit the scope of the regulation to business, not being term assurance business, with a policy holder not residing in the United Kingdom who is a British citizen, or in respect of whose business the insurance company has treated the amended regulation 7 as applying.

Regulation 7 inserts a new regulation (regulation 7A) in the principal Regulations which caters for overseas direct services business of an insurance company where the business, not being reinsurance business or term assurance business, is with a policy holder who is not an individual within the amended regulation 7 of the principal Regulations.

Regulation 8 amends regulation 8 of the principal Regulations (overseas direct services business where the insurance company comes into possession of additional information) so as to cater for transfers of insurance business from non-UK insurance companies and also to limit the scope of the regulation to business which is not term assurance business and which is with a policy holder within the amended regulation 7 of the principal Regulations.

Regulation 9 amends regulation 9 of the principal Regulations (reinsurance of overseas branch business) so as to provide that the certificate prescribed in that regulation is that the underlying policy is one which has been treated as relating to overseas life assurance business.

Regulation 10 amends regulation 10 of the principal regulations (reinsurance of overseas direct services business) so as to limit the scope of the regulation to business which is not term assurance business and which is with a policy holder falling within the amended regulation 7 of the principal Regulations.

Regulation 11 inserts a new regulation (regulation 10A) in the principal Regulations which caters for reinsurance of overseas direct services business where the business is not term assurance business and is with a policy holder who is not an individual within the amended regulation 7 of the principal Regulations.

Regulation 12 amends regulation 11 of the principal Regulations (reinsurance of overseas direct services business where the insurance company comes into possession of additional information) so as to limit the scope of the regulation to business which is not term assurance business and which is with a policy holder within the amended regulation 7 of the principal Regulations.

Regulation 13 amends regulation 13 of the principal Regulations (territory in which policy holder residing in the case of overseas branch business) so as to cater for transfers of insurance business from non-UK insurance companies and also to extend the time limits relating to the insurance company receiving information that the policy holder is residing in the United Kingdom.

Regulation 14 amends regulation 14 of the principal Regulations (territory in which policy holder residing in the case of overseas direct business) so as to make similar provision to the amendment made by regulation 13 of these Regulations in relation to a policy holder falling within the amended regulation 7 of the principal Regulations.

Regulation 15 inserts a new regulation (regulation 14A) in the principal Regulations so as to make provision for the territory in which the policy holder is residing in the case of overseas direct business with a policy holder who is not an individual within the amended regulation 7 of the principal Regulations.

Regulation 16 amends regulation 15 of the principal Regulations (territory in which policy holder residing in the case of reinsurance of overseas branch business) so as to extend the time limits relating to the insurance company receiving information that the policy holder is residing in the United Kingdom.

Regulation 17 amends regulation 16 of the principal Regulations (territory in which policy holder residing in the case of reinsurance of overseas direct business) so as to extend the time limits relating to the insurance company receiving information that the policy holder is residing in the United Kingdom where the policy holder is an individual falling within the amended regulation 7 of the principal Regulations.

Regulation 18 inserts a new regulation (regulation 16A) in the principal Regulations so as to make provision for the territory in which the policy holder is residing in the case of reinsurance of overseas direct business with a policy holder who is not an individual within the amended regulation 7 of the principal Regulations.

Regulations 19 and 21 make amendments to regulations 18 and 19 of the principal Regulations (reclassification of policy or contract from date when or after it was effected) which are consequential on the amendments made by preceding regulations of these Regulations. Regulation 21 also amends regulation 19 of the principal Regulations so as to provide that a policy or contract whose business was overseas life assurance business when the policy or contract was made is not required to be reclassified as relating to basic life assurance business on a subsequent failure to meet the “relevant overseas employees” test in section 431D(7) of the Income and Corporation Taxes Act 1988, provided that the number of non resident overseas employees who stand to benefit under the policy or contract does not exceed 20 per cent. of the total number of persons who stand to benefit.

Regulation 20 inserts a new regulation (regulation 18A) in the principal Regulations so as to provide that, where the requirements of regulation 5 of the principal Regulations (as amended by regulation 5 of these Regulations) have not been observed, a policy or contract shall be treated as relating to overseas life assurance business from the date on which it was made or transferred.