Liabilities on Commonwealth insurers--special condition
187 Liabilities on Commonwealth insurers--special condition
(1) In this
section--
"Commonwealth insurer" means a company authorised to carry on insurance
business under the Insurance Act 1973of the Commonwealth or a company
registered under the Life Insurance Act 1945 of the Commonwealth.
"licensed insurer" includes an insurer formerly licensed under this Division.
(2) It is a condition of a licence granted under this Division that the
licensed insurer will not, without the approval of the Authority and the
concurrence of the Treasurer of the Commonwealth, enter into a contract or
arrangement whereby a Commonwealth insurer is or may become liable to pay any
money to or on behalf of the licensed insurer.
(3) A contract or an
arrangement is not invalid merely because it has been entered into in
contravention of subsection (2).
(4) The Supreme Court may, on the
application of the Authority or the Treasurer of the Commonwealth, declare
invalid a contract or arrangement entered into in contravention of subsection
(2) if satisfied that the declaration will not prejudice the rights arising
out of the contract or arrangement of any person who entered into the contract
or arrangement in good faith and without knowledge of the contravention.
