asked the Minister for Industry and Commerce whether he is aware of the practice whereby an insurance company (details supplied) refuses to convert an industrial life policy into a paid up policy unless the policy holder defaults in payment of premiums for ten weeks; and if having regard to the risks and disadvantages to the policy holder inherent in such a practice he will have it discontinued.
Ceisteanna—Questions. Oral Answers. - Insurance Policy Conversion.
58.
I cannot see how the practice whereunder industrial policies are not lapsed until a premium is at least ten weeks in arrear involves any risks or disadvantages to the policy holder. The practice is, in fact, imposed on insurance companies by law with the purpose of protecting the policy holder. The law requires the company to keep the policy in force for this period of time at least, with the result that the policy holder has the option of continuing the policy after this period, and in the meantime, continues to enjoy full rights under the contract.
Can the Minister say whether the legal obligation to which he refers is applicable to British companies and, if not, would he consider that Irish and English companies would operate under the same circumstances? It is my information that, when a policy holder opted to have his two policies converted recently, he was sent a cheque immediately by the British company but in the case of the Irish company he was required to wait for ten weeks.
Did he decide to surrender the policies?
Yes.
The surrendering of a policy as distinct from leaving it in arrears is different from the point raised by the Deputy. The provision to which I referred applies to all companies, but I will look into the matter.
I shall send the Minister the details.