Legal basis of insurance: no statutory definition
There is no statutory definition of insurance in either the Taxes Acts or the Financial Services and Markets Act 2000 (FSMA 2000), although the Financial Services Authority (FSA) gives guidance on the identification of contracts of insurance (GIM1080). ICTA88/S431 (2) defines an insurance company for the limited purposes of Part 12 of the Act as:
a person (other than a friendly society) who has permission under Part 4 of the Financial Services and Markets Act 2000 to effect or carry out contracts of insurance, or
an EEA firm of the kind mentioned in paragraph 5(d) of Schedule 3 to that Act or a firm qualifying for authorisation under Schedule 4 to that Act which
- carries on business which consists of the effecting or carrying out of contracts of insurance, and
- carries on that business through a branch or agency in the United Kingdom.For this purpose contract of insurance takes the meaning given by article 3 of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, known as the RAO, SI2001/544. This in turn refers to Schedule I to the Order, which classifies contracts of insurance between contracts of general insurance and contracts of long-term insurance, listed in Part 1 and Part 2 respectively. Part 1 divides general insurance into 18 different classes of insurance business for regulatory purposes. The word insurance is left undefined.