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| Insurers in financial difficulties. |
188. - (1) The compensation scheme may, in particular, include provision for the scheme manager to have power to take measures for safeguarding policyholders, or policyholders of a specified class, of relevant insurers.
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(2) "Relevant insurers" means relevant persons who-
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(a) carry on insurance business; and |
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(b) are in financial difficulties. |
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(3) The measures may include such measures as the scheme manager considers appropriate for-
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(a) securing or facilitating the transfer of the insurance business of a relevant insurer, or any part of it, to another authorised person; |
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(b) giving assistance to the relevant insurer to enable it to continue insurance business. |
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(4) The scheme may provide-
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(a) for the power to take measures of a kind mentioned in subsection (3)(a) to be on terms, including terms reducing the liabilities or the benefits provided for under any policies, appearing to the scheme manager to be appropriate; |
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(b) for the power to take measures of a kind mentioned in subsection (3)(b) to be conditional on the reduction of any liabilities or benefits provided for under any policies of the relevant insurer concerned; |
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(c) for ensuring that measures of a kind mentioned in subsection (3)(b) do not benefit to any material extent persons who were members of a relevant insurer when it began to be in financial difficulties or who had any responsibility for, or who may have profited from, the circumstances giving rise to its financial difficulties, except in specified circumstances; |
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(d) for requiring the scheme manager to be satisfied that any measures he proposes to take are likely to cost less than it would cost to pay compensation under the scheme if the relevant insurer became unable, or likely to be unable, to satisfy claims made against him. |
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(5) The scheme may provide for the Authority to have power-
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(a) to give such assistance to the scheme manager as it considers appropriate for assisting the scheme manager to determine what measures are practicable or desirable in the case of a particular relevant insurer; |
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(b) to impose constraints on the taking of measures by the scheme manager in the case of a particular relevant insurer; |
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(c) to require the scheme manager to provide it with information about any particular measures which the scheme manager is proposing to take. |
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(6) The scheme may include provision for the scheme manager to have power-
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(a) to make interim payments in respect of eligible policyholders of a relevant insurer; |
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(b) to indemnify any person making payments to eligible policyholders of a relevant insurer. |
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(7) A provision of the scheme made by virtue of section 184(3)(b) may include power to impose levies for the purpose of meeting expenses of the scheme manager incurred in-
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(a) taking measures as a result of any provision of the scheme made by virtue of subsection (1) or (3); |
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(b) making payments or giving indemnities as a result of any such provision made by virtue of subsection (6). |
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(8) "Financial difficulties" and "eligible policyholders" have such meanings as may be specified.
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Annual report |
| Annual report. |
189. - (1) At least once a year, the scheme manager must make a report to the Authority on the discharge of its functions.
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(2) The report must-
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(a) include a statement setting out the value of each of the funds established by the compensation scheme; and |
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(b) comply with any requirements specified in rules made by the Authority. |
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(3) The scheme manager must publish each report in the way it considers appropriate.
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Information and documents |
| Scheme manager's power to require information. |
190. - (1) The scheme manager may, by notice in writing served on the relevant person in respect of whom a claim is made under the scheme or on a person otherwise involved, require that person-
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(a) to provide specified information or information of a specified description; or |
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(b) to produce specified documents or documents of a specified description. |
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(2) The information or documents must be provided or produced-
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(a) before the end of such reasonable period as may be specified; and |
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(b) in the case of information, in such manner or form as may be specified. |
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(3) This section applies only to information and documents the provision or production of which the scheme manager considers-
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(a) to be necessary for the fair determination of the claim; or |
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(b) to be necessary (or likely to be necessary) for the fair determination of other claims made (or which it expects may be made) in respect of the relevant person concerned. |
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(4) If a document is produced in response to a requirement imposed under this section, the scheme manager may-
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(a) take copies or extracts from the document; or |
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(b) require the person producing the document to provide an explanation of the document. |
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(5) If a person who is required under this section to produce a document fails to do so, the scheme manager may require the person to state, to the best of his knowledge and belief, where the document is.
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(6) No person may be required under this section to produce or disclose a privileged communication.
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(7) If a person claims a lien on a document, its production under this Part does not affect the lien.
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(8) "Specified" means specified in the notice served under subsection (1).
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(9) A person is involved in a claim made under the scheme if he was knowingly involved in the act or omission giving rise to the claim.
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| Scheme manager's power to inspect information held by liquidator etc. |
191. - (1) For the purpose of assisting the scheme manager to discharge its functions in relation to a claim made in respect of an insolvent relevant person, the liquidator, administrator or trustee in bankruptcy of that person must permit a person authorised by the scheme manager to inspect relevant documents.
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(2) A person inspecting a document under this section may take copies of, or extracts from, the document.
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(3) This section does not apply if the liquidator, administrator or trustee in bankruptcy is-
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(a) the Official Receiver; |
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(b) the Official Receiver for Northern Ireland; or |
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(c) the Accountant in Bankruptcy. |
| Powers of court where information required. |
192. - (1) If a person ("the defaulter")-
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(a) fails to comply with a requirement imposed under section 190, or |
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(b) fails to permit documents to be inspected under section 191, |
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the scheme manager may certify that fact in writing to the court and the court may enquire into the case.
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(2) If the court is satisfied that the defaulter failed without reasonable excuse to comply with the requirement (or to permit the documents to be inspected), it may punish the defaulter (and, in the case of a body corporate, any director or officer) as if he had been guilty of contempt of court.
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(3) "Court" means-
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(b) in Scotland, the Court of Session. |
