How does the law relate to my purchase of Life Insurance?
There are a number of important regulations that affect
the purchase of Life Insurance.
The following information should be relevant as you consider
purchasing Life Insurance on the Internet. You should regard this information
as a useful introduction. It is not designed to cover everything, but
it should help to get you started.
If you want more background information about the regulation
of Life Insurance Companies and Insurance Brokers, you can visit the website
of the Financial Services Authority at www.fsa.gov.uk.
You will find that you need to reside in the UK in order
to purchase Life Insurance from a UK-based Life Insurance Company. Although
this is not actually specified in UK law, the law does make it impossible
for a UK-based Life Insurance Company to sell Life Insurance to anyone
who does not live in the UK.
There is no law that says you must have Life Insurance.
In the UK, this is a form of insurance that you can choose to have or
not.
The Insurance Company that you purchase your policy from
will be subject to all UK Corporate Laws. In addition, there are laws
that only apply to Insurance Companies. Such laws regulate the risks that
Insurance Companies take on in relation to their financial reserves. These
laws are designed to make sure the Insurance Company will be in a position
to pay out if you make a claim.
The Data Protection Act 1998 is another important piece
of legislation. It is concerned with the way UK organisations store, safeguard
and use the information that they have collected about you. This is obviously
important for Insurance Companies who will hold a lot of personal data
such as medical histories. The Data Protection Act means that your data
cannot be passed on to another company without you being given the opportunity
to refuse permission for this use. Reputable websites that sell Life Insurance
will have a Privacy Statement that explains how they
use the information they hold. Brokers Online provide the privacy statement
for us, as they hold and maintain your details. It is a good idea to take
time to read this statement.
The other vitally important piece of legislation is the
Financial Services and Markets Act (2000). Click on the question below
for more details.