PART 3

Friendly societies carrying on long-term business

Exempt BLAGAB or eligible PHI business

Meaning of “BLAGAB or eligible PHI business”
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1
In this Part “BLAGAB or eligible PHI business” means—
a
basic life assurance and general annuity business, and
b
any PHI business so far as consisting of the effecting or carrying out of qualifying contracts,
but see subsections (3) and (4) for some qualifications.
2
A contract is a “qualifying” contract if—
a
it is made before 1 September 1996, or
b
it is made on or after that date and it also falls within paragraph I, II or III of Part 2 of Schedule 1 to the FISMA (Regulated Activities) Order 2001.
3
A contract made before 1 September 1996 which effects a policy affording provision for injury, sickness or other infirmity is to be regarded for the purposes of this Part as forming part of “BLAGAB or eligible PHI business” only if—
a
the policy also affords assurance for a gross sum independent of injury, sickness or other infirmity,
b
at least 60% of the total premiums are attributable to the provision afforded during injury, sickness or other infirmity, and
c
there is no bonus or addition which may be declared or accrue upon the assurance of the gross sum.
4
Business is not to be regarded as “BLAGAB or eligible PHI business” of a friendly society for the purposes of this Part so far as it consists of the assurance of any annuity the consideration for which consists of sums obtainable—
a
on the maturity, or
b
on the surrender,
of any other policy of assurance issued by the society which forms part of its exempt BLAGAB or eligible PHI business.