Insurance (No. 2) Act, 1983
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Bodies connected with insurers. |
4.—(1) The court may, in relation to a body connected with an insurer, on application to it by the administrator (whether appointed under subsection (2) or (4) of section 2 of this Act), if it considers— | |
(a) that— | ||
(i) the affairs of that body are being conducted, or are likely to be conducted, in a manner which is calculated or likely to jeopardise or prejudice the interests of the insurer or of the creditors or policy holders of the insurer, or | ||
(ii) it is expedient, for the purpose of preserving the assets (including the investments) of the insurer or of safe guarding the interests of the insurer, its creditors or policy holders, that the carrying on of the business of that body or the exercise of the powers of its directors or management should be curtailed or regulated in any particular respect, or | ||
(iii) having regard to the relationship between the insurer and that body, any part of the property or undertaking of the body should be preserved or controlled, | ||
and | ||
(b) that, to do so would be just and equitable and would, by facilitating and contributing to the safeguarding of the interests of the insurer or of the creditors or policy holders of the insurer, assist in the maintenance, in the public interest, of the proper and orderly regulation and conduct of non-life insurance business, | ||
make such order as it thinks fit (including an order conferring powers on the administrator in relation to the affairs of that body) whether directing or prohibiting any act or restraining, cancelling or varying any agreement or transaction or the exercise of any power. | ||
(2) Without prejudice to the generality of the foregoing, the court may, if it thinks fit, by order— | ||
(a) appoint the administrator of an insurer to be a receiver and manager of all or any part of the property and assets of the connected body concerned and confer upon him such powers in that behalf as the court may think fit and specify in the order, including power to carry on the business of the body, | ||
(b) appoint such additional directors or other members of the committee of management of the connected body as the administrator may nominate, notwithstanding any provision or restriction to the contrary contained in the articles of association of the connected body, or otherwise contained in its rules or constitution, | ||
(c) provide that the exercise of the functions of the directors, secretary and other officers of the connected body engaged in its management shall be subject to the direct control of the administrator. | ||
(3) The power to make an order under subsection (1) or (2) of this section shall extend to the making of an interim order upon the ex parte application of an administrator. | ||
(4) A body shall be deemed for the purposes of this Act to be connected with an insurer if— | ||
(a) it is the holding company or a subsidiary (within the meaning, in each case, of section 155 of the Companies Act, 1963 ) of the insurer, or | ||
(b) effective control of the management of the insurer and of the body is held by or entrusted to the same persons or substantially the same persons, or | ||
(c) in the opinion of the court, the effective management and control of either the insurer or the body is significantly influenced or capable of being significantly influenced (whether directly or indirectly, actually or potentially) by the other of them, or | ||
(d) an inability on the part of either the insurer or the body to meet its debts as they fall due or for any reason to continue trading would jeopardise or prejudice the ability of the other of them to meet its debts or continue trading, whether by reason of the degree of financial interdependence between them or of a substantial common management or otherwise howsoever. |