INSURANCE CORPORATION ACT

Arrangement of Sections

1. Short title.

PART I

ESTABLISHMENT OF THE INSURANCE CORPORATION OF CEYLON

2. Establishment of the Insurance Corporation of Ceylon.

3. Corporation to be a body corporate.

4. Seal of the Corporation.

5. Functions of the Corporation

6. Powers of the Corporation.

7. Appointment of officers, servants and agents of the Corporation.

8. Minister's directions to the Corporation.

9. Transfer to the Corporation of the assest, liabilities and contracts of the Co-operative Insurance Department.

PART II

PROVISION RELATING TO INSURANCE BUSINESS CARRIED ON BY INSURERS OTHER THAN THE CORPORATION

10. Insurers authorised to transact new Insurance business.

11. Repealed.

12. Repealed.

13. Repealed.

14. Insurers carrying on life insurance business may transfer to the Corporation such business if the Corporation is satisfied after an investigation of the financial condition of the insurer's business that the assest of the business are more than, or equal to, the liabilities.

15. Repealed.

16. Repealed.

PART III

CORPORATION

PROVISIONS RELATING TO FINANCES AND ACCOUNTS OF THE

17. Capital of the Corporation.

18. The Fund of the Corporation.

19. Accounts of the Corporation.

20. Accounts and balance sheet for each year.

21. Audit of accounts.

22. The Auditor General's report.

23. Annual accounts with auditor's report and a report of the annual activities of the Corporation to be transmitted to the Minister.

24. Actuarial investigation into the financial condition of the life insurance business of the Corporation to be made once at least in every five years.

25. Allocation or reservation of a certain percentage of the surplus to holders of policies of life insurance.

27. Repealed.

28. Receipts on behalf of the Corporation.

GENERAL

29. Acquisition of immovable property under the Land Acquisition Act for the Corporation.

PART IV

30. Repealed.

31. Repealed.

32. Application of company law to the Corporation.

33. Power of the Minister to direct an inquiry to be held into the working of the Corporation.

33A. Liabilities of the Corporation, including bonuses declared in the case of life Insurance policies, guaranteed by the Government.

33B. Employment of certain persons in the Corporation.

34. Regulations.

35. Offences.

36. Liability of agent, manager or other employee.

37. Offences by bodies of persons.

38. Repealed.

39. Interpretation.

40. Act to prevail in case of conflict with other written law.

2 of 1961,

25 of 1962,

11 of 1963,

18 of 1965,

6 of 1966,

22 of 1979,

43 of 1986

1386-18-2005.

AN ACT to provide for the establishment of an Insurance Corporation for carrying on the business of life insurance and carrying on in addition insurance business of every description; to terminate the transaction of new business by other insurers carrying on life insurance business; to provide that such insurers shall maintain in Sri Lanka sufficient assest to discharge their obligations under policies of insurance not paid or matured; to provide for certain matters in relation to insurers carrying on the business of insurance other than life insurance; to provide for the transfer to the corporation of the insurance business carried on by the co-operative wholesale establishment; and to make provisions for purposes connected with the matters aforesaid.

[Am by s 41 of Act 22 of 1979.]

[Date of Commencement: Sections 2, 7, 8, 17, 18, 30, 31 and 34 10th January, 1961; Other provisions 1st January, 1962]

1. Short title.

This Act may be cited as the Insurance Corporation Act.

PART I

ESTABLISHMENT OF THE INSURANCE CORPORATION OF CEYLON

2. Establishment of the Insurance Corporation of Ceylon.

(1) There shall be established a Corporation which shall be called the Insurance Corporation of Ceylon (hereinafter referred to as the "Corporation”). The Corporation shall consist of five members appointed by the Minister, one of whom shall be designated Chairman of the Corporation.

(2) A person shall be disqualified for being appointed or being a member of the Corporation if he is a Member of Parliament.

(3) A member of the Corporation who is in any way directly or indirectly interested in a contract made or proposed to be made by the Corporation shall disclose the nature of his interests at a meeting of the Corporation and such disclosure shall be recorded in the minutes of the Corporation and the member shall not take part in any deliberation or decision of the Corporation with respect to that contract.

(4) Every member of the shall, subject to the provisions of subsections (5) and (6), hold office for a period of five years from the date of his appointment.

(5) A member of the Corporation may resign from the Corporation by letter addressed to the Minister.

(6) Any member of the Corporation may be removed from office by the Minister if such member is absent from meetings of the Corporation for a period exceeding three months for any cause which does not appear to the Minister to be reasonable, or if the Minister considers that it is expedient to remove such person from office.

(7) Where any member of the Corporation resigns or is removed from office or dies, the Minister may appoint another person to be a member in place of the member who resigns or is removed from office or dies, and the person so appointed shall hold office during the unexpired period of the term of office of the member last mentioned.

(8) Where any member of the Corporation becomes, by reason of illness or other infirmity or absence from Sri Lanka, temporarily unable to perform the duties of his office, the Minister may appoint another person to act in the place of such member.

(9) All or any of the members of the Corporation may be paid such remuneration from the Fund of the Corporation as may be determined by the Minister with the concurrence of the Minister in charge of the subject of Finance.

(10) No act or proceeding of the Corporation shall be invalid by reason only of the existence of any vacancy among its members or any defect in the appointment of a member thereof.

(11) The quorum for any meeting of the Corporation shall be three members of the Corporation, and, subject as aforesaid, the Corporation may regulate its own procedure.

3. Corporation to be a body corporate.

The Corporation shall, by the name given to it by section 2, be a body corporate and shall have perpetual succession and a common seal and may sue and be sued in such name.

4. Seal of the Corporation.

(1) The seal of the Corporation shall be in the custody of such person as the Corporation may from time to time determine.

(2) The seal of the Corporation may be altered in such manner as may be determined by the Corporation.

(3) The seal of the Corporation shall not be affixed to any document except by the authority of the Corporation and in the presence of two members of the Corporation who shall sign the document in token of their presence.

5. Functions of the Corporation

The Corporation shall carry on insurance business of every description in Sri Lanka or outside Sri Lanka, including—

(1) the business of insuring—

(a) any property of the State or of any corporation the entirety of whose capital is provided by the Government, or any property held in trust by any public officer in his official capacity, against the loss of, or any damage to, such property caused by fire, accident, theft, flood or any malicious act or any other cause, or

(b) the Head of any Government Department or any such corporation as aforesaid—

(i) against any loss caused to such Head in his official capacity or to such corporation by the default or fraud of any employee of the State in such Department or any employee of such corporation or any person transacting any business or performing any work for such Head in his official capacity or for such corporation; or

(ii) in respect of any liability which may be incurred by the State or such corporation in consequence of the death of, or any bodily injury to, any employee of the State in such Department or any employee of the corporation, or any other person, or in consequence of the loss of, or any damage to, any property in the custody of any employee of the State in such Department in his official capacity or in the custody of such corporation; or

(c) the Secretary to the Treasury, or the Head of any Government Department, on behalf of the Government against any loss which may be incurred by the Government as a result of the failure of any public officer employed in that Department to repay the whole or any part of any sum of money lent to him by the Government; or

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