Part 6Exempt income

Chapter 8Other annual payments

Health and employment insurance payments

738Risk of significant loss

1

The condition in this section is that throughout the period that the policy has contained provisions relating to the health or employment risk those provisions have been such that any policy of insurance which only contained those provisions would involve the possibility that the insurer would make a significant loss on the premiums.

2

In determining whether a policy would involve that possibility, any return on the investment of the premiums is to be taken into account.

3

For this purpose reinsurance is ignored.