(1)Where an insurance company to which Part II of the M1Insurance Companies Act 1982 applies carries on long term business—
[F1(a)any amount included in the relevant part of the balance sheet of the company which represents a surplus in the fund or funds maintained by it in respect of that business and which has not been allocated to policy holders in accordance with section 30(1) of that Act or carried forward unappropriated as mentioned in section 30(7) of that Act, and]
(b)any deficit in that fund or those funds,
are to be (respectively) treated, for purposes of this Part, as a realised profit and a realised loss; and, subject to this, any profit or loss arising in that business is to be left out of account for those purposes.
(2)In subsection (1)—
[F2(aa)the reference to the relevant part of the balance sheet is to that part of the balance sheet which represents Liabilities item A.V (profit and loss account) in the balance sheet format set out in section B of Chapter I of Part I of Schedule 9A,]
(a)the reference to a surplus in any fund or funds of an insurance company is to an excess of the assets representing that fund or those funds over the liabilities of the company attributable to its long term business, as shown by an actuarial investigation, and
(b)the reference to a deficit in any such fund or funds is to the excess of those liabilities over those assets, as so shown.
(3)In this section—
(a)“actuarial investigation” means an investigation to which section 18 of the Insurance Companies Act 1982 (periodic actuarial investigation of company with long term business) applies or which is made in pursuance of a requirement imposed by section 42 of that Act (actuarial investigation required by Secretary of State); and
(b)“long term business” has the same meaning as in that Act.
Textual Amendments
F1S. 268(1)(a) substituted (2.2.1996) by S.I. 1996/189, reg. 13(2)
F2S. 268(2)(aa) inserted (2.2.1996) by S.I. 1996/189, reg. 13(3)
Marginal Citations