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Part VII · Management by Administration and Winding Up

69. Circumstances under which the District Court may order the winding up of an insurer

Official English translation. Where it differs from the Sinhala or Tamil text, the Act itself says which text prevails.

(1)

The District Court may order the winding up of an insurer in accordance with the Companies Act, No. 17 of 1982, and the provisions of that Act shall, subject to the provisions of this Part of this Act, apply accordingly.

(2)

The District Court may order the winding up of an insurer —

(a)

if a petition in that behalf is presented by holders of not less than one per centum of long term insurance policies issued by that insurer and which have been in force for not less than three years and which will on maturity be of the total value of not less than five hundred thousand rupees ; or

(b)

if the Board, which is hereby authorized to do so, applies in that behalf to the District Court on any of the following grounds, namely —

(i)

that the insurer has failed to comply with the provisions of section 21 or 26 or any directions issued under section 57 ;

(ii)

that the insurer having failed to comply with any requirement of this Act has continued such failure, or having contravened any provisions of this Act, has continued such contravention, for a period of three months after notice of such failure or contravention has been brought to the notice of the insurer by the Board ;

(iii)

that it appears from the returns furnished under the provisions of this Act or from the results of any investigation made thereunder, that the insurer is insolvent ; or

(iv)

that the continuance of the insurer is prejudicial to the interests of the policy holders.

(3)

Where any petition under paragraph (a) of subsection (2) is found to have been made frivolously or vexatiously, the

District Court may make order for the payment by the petitioners of the costs and expenses actually and reasonably incurred by the insurer in consequence of the petition and in the proceedings thereon.

Read on from s 70

Part VIII

Registration of Brokers and Insurance Agents

Read on from Part VIII

Part IX

Offences

Read on from Part IX

Part X

General

Read on from Part X

Schedules