Commonwealth Consolidated Acts

INSURANCE ACT 1973 - SECT 116

  (1)   If a general insurer is started to be wound up:

  (a)   the insurer must not carry on insurance business after the start of the winding up; and

  (b)   APRA must ensure that a notice is published in the Gazette stating that the insurer is no longer allowed to carry on insurance business because of the start of the winding up.

  (2)   A general insurer doesn't contravene subsection   (1) merely because it is carrying on business for the purpose of discharging liabilities assumed by it before the start of the winding up.

  (3)   In the winding up of a general insurer, the insurer's assets in Australia must not be applied in the discharge of its liabilities other than its liabilities in Australia unless it has no liabilities in Australia.

Note:   Section   116A deals with assets and liabilities in Australia.

  (3A)   For the purposes of subsection   (3), a pre - authorisation liability of a general insurer is taken not to be a liability in Australia of the general insurer.

  (4)   Nothing in this section affects the validity of a contract entered into by a general insurer after it is started to be wound up.

  (5)   This section has effect and must be complied with despite anything in any law of a State or Territory.