LIFE ASSURANCE AND ORPHAN ASSETS

Summary

That this House is in favour of greater clarity in the attribution of the long-term assets held in the life fund of shareholder-owned insurance companies; recognises that the guiding principle in the allocation of surplus assets is that the reasonable expectation of the policyholders should be protected; notes the continuing controversy over the division of these assets between policyholders and shareholders and that this does not relate to mutual insurers such as Standard Life who are owned by their policyholders; expresses concern that these assets may be used to pay compensation for pension mis-selling where it may be more appropriate that the risk be borne by the shareholders; supports the comments of the Government Actuary that the actuarial profession is placing too much emphasis on shareholders and the life assurance industry is not doing enough to protect the interests of policyholders; and calls on the FSA, when the Financial Services and Markets Bill becomes law, to issue guidance and make rules for the protection of policyholders and potential policyholders of shareholder-owned insurance companies.

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Timeline

1. 18 May 2000

   Early Day Motion

   That this House is in favour of greater clarity in the attribution of the long-term assets held in the life fund of shareholder-owned insurance companies; recognises that the guiding principle in the allocation of surplus assets is that the reasonable expectation of the policyholders should be protected; notes the continuing controversy over the division of these assets between policyholders and shareholders and that this does not relate to mutual insurers such as Standard Life who are owned by their policyholders; expresses concern that these assets may be used to pay compensation for pension mis-selling where it may be more appropriate that the risk be borne by the shareholders; supports the comments of the Government Actuary that the actuarial profession is placing too much emphasis on shareholders and the life assurance industry is not doing enough to protect the interests of policyholders; and calls on the FSA, when the Financial Services and Markets Bill becomes law, to issue guidance and make rules for the protection of policyholders and potential policyholders of shareholder-owned insurance companies.

   Source: Early Day Motion

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Sponsors

• Mr Andrew Love · Labour · Primary sponsor

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