CRITICAL ILLNESS INSURANCE IN BANKRUPTCY

Motion Text

That this House congratulates the Mail on Sunday for publicising the case of Alan Rawlins, the disabled formerly self-employed builder whose Trustee in Bankruptcy has been allowed to keep all of the proceeds of his critical illness insurance policy; recognises with concern that in bankruptcy the proceeds of such policies do not benefit from the same ring-fenced protection as that afforded to personal pensions; believes that the inconsistency is unjust and penalises those who make proper provision to support themselves and their families in the event that they suffer critical illness and results in the imposition of additional burdens on state resources; recognises the urgent need to ensure that disabled bankrupts are not disadvantaged in income terms by comparison with working bankrupts; and urges the Secretary of State to review the relevant provisions of the insolvency legislation.