Written question asked by Vincent Cable (Liberal Democrat) on Monday, 12 February 2001, in the House of Commons. It was due for an answer on Monday, 5 March 2001. It was answered by Melanie Johnson (Labour) on Monday, 5 March 2001 on behalf of the Treasury.

Treasury

Question: To ask Mr Chancellor of the Exchequer, what steps his Department took, between 1990 and the transfer of the insurance regulatory function to the Financial Services Authority to (a) investigate and monitor the reserves kept by insurance companies to satisfy their commitments under their guaranteed annuity rate policies, (b) monitor the extent of potential liabilities of insurance companies under guaranteed annuity rate policies and (c) ensure that insurance companies had (i) provided for and (ii) fully disclosed their potential liabilities under their guaranteed annuity rate policies within their annual report and accounts; on what occasions between 1990 and the transfer of the insurance regulatory function to the Financial Services Association his Department approved of the operation of non-guaranteed annuity rate policies from within the same fund or funds as guaranteed annuity rate policies. - (Holding answer 15 February 2001).

Answer: Dr. Cable: To ask the Chancellor of the Exchequer (1) what steps his Department took, between 1990 and the transfer of the insurance regulatory function to the Financial Services Authority to (a) investigate and monitor the reserves kept by insurance companies to satisfy their commitments under their guaranteed annuity rate policies, (b) monitor the extent of potential liabilities of insurance companies under guaranteed annuity rate policies and (c) ensure that insurance companies had (i) provided for and (ii) fully disclosed their potential liabilities under their guaranteed annuity rate policies within their annual report and accounts; [150438] (2) on what occasions between 1990 and the transfer of the insurance regulatory function to the Financial Services Association his Department approved of the operation of non-guaranteed annuity rate policies from within the same fund or funds as guaranteed annuity rate policies. [150436] Miss Melanie Johnson: [holding answer 15 February 2001]: The Insurance Companies Act 1982 sets out the requirements on insurance companies to maintain an adequate margin of solvency. The regulator monitors companies on an ongoing basis to ensure that regulatory requirements are met.

Secondary information