Industrial Assurance and Friendly Societies (Emergency Protection from Forfeiture) Act 1940
| Jurisdiction | UK Non-devolved |
| Citation | 1940 c. 10 |
| Year | 1940 |
Industrial Assurance and Friendly Societies (Emergency Protection from Forfeiture) Act, 1940
(3 & 4 Geo. 6.) CHAPTER 10.
An Act to protect from forfeiture industrial assurance policies and certain other assurance policies effected with registered friendly societies, in cases where default occurs in consequence of the war.
[14th March 1940]
B E it enacted by the King's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—
1 Application of Act to assurance policies.
1. This Act applies to—
being policies of assurance for an amount not exceeding fifty pounds, exclusive of any bonus added thereto, which were in force immediately before the first day of September nineteen hundred and thirty-nine and in respect of which not less than two years' premiums have been paid (whether before or after the passing of this Act).
2 Protection from forfeiture in cases of default due to war.
(1) In relation to any policy of assurance to which this Act applies, being a policy of industrial assurance or a policy effected with a collecting society, a notice served after the passing of this Act under section twenty-three of the Industrial Assurance Act, 1923 (which provides that a forfeiture shall not be incurred by reason of the non-payment of any premium, unless default has been made in paying the premium within twenty-eight days after the service of a notice stating the amount in arrear) shall be of no effect unless, in addition to the matters required to be stated under the said section, it contains a statement in the prescribed form that an application may be made in writing within twenty-eight days and at a place specified in the notice to the industrial assurance company or collecting society, as the case may be, for protection from forfeiture on the ground that the default is due to circumstances arising directly or indirectly out of the war.
(2) Where any notice has been served in accordance with the foregoing subsection, the owner of the policy or any other person on his behalf may make an application in accordance with the notice, and if the company or society is satisfied that the default to which the notice relates is due to circumstances arising directly or indirectly out of the war, it shall endorse the policy, or serve on the applicant a further notice, to the effect that it is a policy protected under this Act.
(3) If the company or society refuses the application, it shall serve a further notice in the prescribed form on the applicant informing him that an appeal from the refusal may be made within twenty-eight days by or on behalf of the owner of the policy to the Industrial Assurance Commissioner (hereafter in this Act referred to as ‘the Commissioner’); and on an appeal being made in accordance with the notice, the Commissioner shall, if he is satisfied that the application ought to have been granted, make an order requiring the company or society to endorse the policy, or serve on the applicant a further notice, to the effect that it is a policy protected under this Act.
(4) Where an application under this section is refused by the company or society, the policy to which it relates shall not be forfeited unless a notice has been served under the last foregoing subsection and either—
(a ) no appeal has been made and twenty-eight days have elapsed since the service of that notice; or
(b ) an appeal has been made and refused.
(5) Where an application under this section is granted, whether by the company or society or the Commissioner, then, subject to the provisions of this Act relating to the determination of protection, the policy shall not be forfeited for the default to which the application related or any subsequent default in the payment of premiums and no further notice shall be served under section twenty-three of the Industrial Assurance Act, 1923.
3 Reduction of sum assured and \(in the case of certain endowment policies) postponement of maturity, where premiums remain unpaid.
(1) The following provisions shall have effect where there is a default in the payment of any premiums payable under a policy of assurance and protection from forfeiture in respect of the default is granted under this Act:—
(a ) where, before the expiration of the period of grace, a claim arises under the policy, then, if and so far as the premiums in respect of which the default occurred have not been paid or tendered to the company or society before the date on which the claim arises, the amount payable in respect of the claim shall be reduced by the amount of those premiums together with interest thereon; and
(b ) where the policy is for the whole term of life and is in force at the expiration of the period of grace, then, if and so far as the said premiums have not been paid or tendered to the company or society before the expiration of that period, the amount assured by the policy shall be reduced by the sum produced by multiplying the amount of those premiums by the factor specified in the second column of the Schedule to this Act in relation to the age group mentioned in the first column of that Schedule, within which falls the age, on the anniversary of the day of his birth next after the expiration of the period of grace, of the person upon whose life the policy was effected, and the company or society shall endorse the policy to that effect or shall serve a notice to that effect on the owner of the policy; and
(c ) in the case of an endowment policy which is in force at the expiration of the period of grace, then, if and so far as the said premiums have not been paid or tendered to the company or society before the expiration of that period, the date of maturity of the policy shall be postponed by a period equal to that in respect of which the outstanding premiums were payable, and the period during which premiums under the policy remain payable after the expiration of the period of grace shall be correspondingly extended, and the company or society shall endorse the policy to that effect or shall serve a notice to that effect on the owner of the policy.
(2) For the purposes of the foregoing subsection—
(a ) any sums paid or tendered in respect of unpaid premiums shall be treated as satisfying those premiums in the order in which they fell due; and
(b ) the interest chargeable on unpaid premiums shall be compound interest at the rate of three per cent. per annum, with half-yearly rests.
(3) Where in relation to any policy of assurance which has been protected under this Act the amount of a free paid-up policy or of a surrender value is required to be ascertained, the provisions of the policy, or of any guarantee given in relation thereto, or of the Industrial Assurance Acts, 1923 to 1929, relating to free paid-up policies and surrender values shall have effect subject to such modifications as appear to the Commissioner to be necessary having regard to the failure to pay premiums during the period of...
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