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New Clause 7 - Flood insurance obligations

Water Bill – in a Public Bill Committee at 3:30 pm on 12th December 2013.

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‘(1) The Secretary of State may by regulations require a relevant insurer to issue in a prescribed period insurance policies that provide cover against a prescribed description of risk for a prescribed number of registered premises.

(2) The regulations may prescribe different numbers of registered premises for diff erent descriptions of risk.

(3) The descriptions of risks that may be prescribed are those relating to the effects of flooding.

(4) The regulations may provide for a prescribed number relating to a relevant insurer to be determined by reference to factors that include in particular—

(a) a target number (see section (Flood insurance obligations: target number));

(b) the relevant insurer’s share of insurance business of a prescribed description.

(5) The regulations may—

(a) make provision about determining the size of a relevant insurer’s share of insurance business of a prescribed description;

(b) provide for a relevant insurer to be exempt from the obligation described in subsection (1) in prescribed circumstances, whether wholly or so far as regards a particular description of risk, including circumstances relating to the amount of insurance business done by the relevant insurer;

(c) make provision about the circumstances in which a relevant insurer ceases to be subject to the obligation described in subsection (1), whether wholly or so far as regards a particular description of risk;

(d) make provision about the cases in which issuing an insurance policy is notto count towards discharging an obligation imposed on a relevant insurer by the regulations, including cases in which an insurance policy is not to count because of the content of its terms;

(e) make provision for allowing an insurance policy issued by another insurer to count towards the discharge of an obligation to issue a number of insurance policies imposed on a relevant insurer by the regulations;

(f) make provision about determining the number of registered premises for which a relevant insurer has issued insurance policies, including provision for varying, by reference to the risk band applicable to the particular registered premises, the extent to which insuring those premises counts in determining that number.

(6) Provision under subsection (5)(a) may require an insurer, in determining the insurer’s share of insurance business of a prescribed description, to use information about that insurance business held by—

(a) the Secretary of State,

(b) a person acting on behalf of the Secretary of State, or

(c) the FCA.

(7) Subsection (5)(e) is not to be taken as requiring a change in the person who is the insurer in relation to an insurance policy.

(8) Regulations under this section may include provision in respect of cases where an insurerhas not provided such information as is required by regulations under section (Flood insurance obligations: information) including—

(a) provision for determining whether the insurer is a relevant insurer,

(b) provision for determining whether an exemption applies, and

(c) provision for determining what share of insurance business of a prescribed description the insurer is to be treated as having.

(9) Before making regulations under this section, the Secretary of State must consult such persons as the Secretary of State considers appropriate.

(10) In this section “prescribed” means specified in or determined in accordance with regulations under this section.’—(Dan Rogerson.)

Brought up, and read the First and Second time.

Amendment proposed to new clause 7: (a), after subsection (5)(f) at end insert—

‘(g) make provision about the circumstances in which a relevant insurer may require mitigation activity to be a condition of cover under an insurance policy.’—(Thomas Docherty.)

Question put, That the amendment be made.

The Committee divided: Ayes 5, Noes 9.

Division number 5 Decision Time — New Clause 7 - Flood insurance obligations

Aye: 5 MPs

No: 9 MPs

Ayes: A-Z by last name

Nos: A-Z by last name

Question accordingly negatived.

Amendment proposed to new clause 7: (b), after subsection (5)(f) at end insert—

‘(g) make provision about the circumstances in which a relevant insurer may require an insured to retain certain elements of the risk under the Flood Reinsurance scheme.’—(Thomas Docherty.)

Question put, That the amendment be made.

The Committee divided: Ayes 5, Noes 9.

Division number 6 Decision Time — New Clause 7 - Flood insurance obligations

Aye: 5 MPs

No: 9 MPs

Ayes: A-Z by last name

Nos: A-Z by last name

Question accordingly negatived.

Amendment proposed to new clause 7: (c), after subsection (5)(f) at end insert—

‘(g) make provision about the circumstances in which a relevant insurer must build awareness of flood risk amongst those living in high risk households.’—(Thomas Docherty.)

Question put, That the amendment be made.

The Committee divided: Ayes 5, Noes 9.

Division number 7 Decision Time — New Clause 7 - Flood insurance obligations

Aye: 5 MPs

No: 9 MPs

Ayes: A-Z by last name

Nos: A-Z by last name

Question accordingly negatived.

New clause 7 added to the Bill.