Clause 25 - Corporate members of Lloyd’s: stop-loss insurance and quota share contracts

Part of Finance Bill – in a Public Bill Committee at 5:30 pm on 12 June 2012.

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Photo of Mark Hoban Mark Hoban The Financial Secretary to the Treasury 5:30, 12 June 2012

It is a pleasure to serve under your chairmanship this afternoon, Mr Bone.

As the hon. Member for Kilmarnock and Loudoun said, the measure is a straightforward one, addressing the issue that emerges when corporates in Lloyd’s take out cover against losses and have claimed the cost of that in advance of the profits being incurred, and the timing difference that works in their favour.

We have had quite extensive discussions with Lloyd’s, as the hon. Lady referred to, so she got this point right: the measure has been greeted with a degree of support—“consent”, I suppose, is probably a better way of describing it. It applies only to corporates, not individuals.

The estimate referred to by the hon. Lady is the estimate we gave at the time of the autumn statement. We have no reason to believe that the estimate is in any way incorrect. We expect it to raise the revenue that we indicated at that time.