asked the Minister for Industry and Commerce if representations have been made to him by policy holders whose policies have been compulsorily transferred to the Irish Assurance Company under recent insurance legislation, and who find, as a result of that transfer, that they are entitled only to the payment of a certain limited sum at the end of a specified period, although premiums have been paid by such policy holders for many years at a rate calculated on the basis that eventually they would receive the sum assured, together with profits; if such representations have disclosed that as a result of the said legislation these policy holders now become entitled after the payment of such premiums to a sum which is less in value than the amount of the said premiums; and, if so, if he has any proposals to make to relieve the hardship so occasioned to such policy holders by the legislation previously promoted by him.
Ceisteanna—Questions. Oral Answers. - Insurance Policies.
The answer to the first part of the Deputy's question is in the affirmative.
The position of the with-profit policies of the several participating companies transferred to The Industrial and Life Assurance Amalgamation Company, Limited, by the Insurance (Amendment) Act 1938 is governed by Clause 18 (iii) of the Schedule to that Act. This provides that with-profit policies shall be converted into non-profit policies at the transfer date by assuming that the premium in excess of a scale of non-profit premiums shall be treated as the gross premium to purchase an additional sum assured at the valuation age according to such scale.
In the course of their independent existences the several participating companies never attained a financial position which enabled them to declare profits for credit to their with-profit policies and in consequence at transfer date these policies had no accrued bonus rights. The policies were at that date converted into non-profit policies for the remainder of their term with a proportionately larger sum assured and claims are being paid by The Industrial and Life Assurance Amalgamation Company Limited on that basis.
The Deputy will appreciate that so far from the Insurance (Amendment) Act 1938 being the cause of any hardship to policy holders in these cases it has been the means of affording equitable relief to them from a position of previous hardship.