Policies made before 17 March 1998: general rules
The PPB legislation applies different rules to policies and contracts that were taken out before 17 March 1998. The category of permitted property that may be selected without making the policy a PPB is rather wider than for policies and contracts made on or after 17 March 1998. There are also transitional rules to allow time for the terms of pre-17 March 1998 policies to be varied to meet the conditions to avoid being a PPB.
Variations on or after 16 July 1998
Where, however, a policy has been varied on or after 16 July 1998 so as to increase the benefits under the policy or increase its term, it is treated for the purpose of the PPB legislation as if it was made on or after 17 March 1998. Then the normal PPB rules described in IPTM7705 to IPTM7790 apply. An exercise of rights under an option in the policy is treated for this purpose as a variation.
IPTM7080 and IPTM7085 explain more about what is meant by ‘increasing the benefits’ and ‘extending the term’ generally. IPTM7825 explains more about variations and substitutions in the context of PPBs.