Part II Insurance Business
130 Restriction on promotion of contracts of insurance.
1
Subject to subsections (2) and (3) below, no person shall—
a
issue or cause to be issued in the United Kingdom an advertisement—
i
inviting any person to enter or offer to enter into a contract of insurance rights under which constitute an investment for the purposes of this Act, or
ii
containing information calculated to lead directly or indirectly to any person doing so; or
b
in the course of a business, advise or procure any person in the United Kingdom to enter into such a contract.
2
Subsection (1) above does not apply where the contract of insurance referred to in that subsection is to be with—
a
a body authorised under section 3 or 4 of the M1Insurance Companies Act 1982 to effect and carry out such contracts of insurance;
b
a body registered under the enactments relating to friendly societies;
c
an insurance company the head office of which is in a member State other than the United Kingdom and which is entitled to carry on there insurance business of the relevant class;
d
an insurance company which has a branch or agency in such a member State and is entitled under the law of that State to carry on there insurance business of the relevant class;
and in this subsection “the relevant class” means the class of insurance business specified in Schedule 1 or 2 to the Insurance Companies Act 1982 into which the effecting and carrying out of the contract in question falls.
3
Subsection (1) above also does not apply where—
a
the contract of insurance referred to in that subsection is to be with an insurance company authorised to effect or carry out such contracts of insurance in any country or territory which is for the time being designated for the purposes of this section by an order made by the Secretary of State; and
b
any conditions imposed by the order designating the country or territory have been satisfied.
4
The Secretary of State shall not make an order designating any country or territory for the purposes of this section unless he is satisfied that the law under which insurance companies are authorised and supervised in that country or territory affords adequate protection to policy holders and potential policy holders against the risk that the companies may be unable to meet their liabilities; and, if at any time it appears to him that the law of a country or territory which has been designated under this section does not satisfy that requirement, he may by a further order revoke the order designating that country or territory.
5
An order under this section shall be subject to annulment in pursuance of a resolution of either House of Parliament.
6
Subject to subsections (7) and (8) below, any person who contravenes this section shall be guilty of an offence and liable—
a
on conviction on indictment, to imprisonment for a term not exceeding two years or to a fine or to both;
b
on summary conviction, to imprisonment for a term not exceeding six months or to a fine not exceeding the statutory maximum or to both.
7
A person who in the ordinary course of a business other than investment business issues an advertisement to the order of another person shall not be guilty of an offence under this section if he proves that the matters contained in the advertisement were not (wholly or in part) devised or selected by him or by any person under his direction or control and that he believed on reasonable grounds after due enquiry that the person to whose order the advertisement was issued was an authorised person.
8
A person other than the insurance company with which the contract of insurance is to be made shall not be guilty of an offence under this section if he proves that he believed on reasonable grounds after due enquiry that subsection (2) or (3) above applied in the case of the contravention in question.