IVA Glossary
P
Policyholders Protection Act 1975
olicyholders Protection Act 1975 is a statute which established the so-called Policyholders Protection Board (or in short, the PPB). This Board is responsible for providing compensation to insured individuals in case their insurers (so the insurance companies in question) go into liquidation. Were not it for this Board, people concluding any kind of insurance product would be exposed to a high risk because of the possible insolvency of their insurers. But this act protects policyholders by undertaking full liability for payment related to certain compulsory insurance policies. The Board also assumes a 90% liability to assist the policyholders with payouts related to other general insurance-types as well as individuals who have an investment-based policy.
People should note though that the compensation provided by this Act only refers to individual policy owners or partnerships. This means that corporate policy owners are not protected by the Policyholders Protection Act 1975.
It is also important to know that there is an amendment of this Act entitled Policyholders Protection Act 1997 which was implemented to correct some ambiguous terms and complete the previous act. Therefore both insurers and insured individuals have to be careful which particular Act applies to them.
People should note though that the compensation provided by this Act only refers to individual policy owners or partnerships. This means that corporate policy owners are not protected by the Policyholders Protection Act 1975.
It is also important to know that there is an amendment of this Act entitled Policyholders Protection Act 1997 which was implemented to correct some ambiguous terms and complete the previous act. Therefore both insurers and insured individuals have to be careful which particular Act applies to them.
