In order to ease some of the flow of much needed capital from the State by means of insurance premiums, the Act makes provisions for the investment of insurance monies in the State in local securities, the categories of which may be added to by the Minister from time to time. The Bill requires companies to make a deposit in money or securities for the protection of policyholders and introduces a provision to enable the Minister to grant legal aid to insured persons who may have genuine difficulties with insurance companies. The Bill enables the Minister by regulations to provide for much of the detail that would be necessary in the administration of the insurance business.

Litigation is pending on the right of the Inland Revenue authorities to obtain disclosure of insurance companies policy records.

This Act, which applies to any kind of insurance activity carried on on a business basis, except when especially otherwise provided for in the Act, makes provisions for parties which have permission to carry on insurance activity in Iceland, the granting of licences by the Minister, the preparation of annual accounts, and reserves out of profits for a catastrophe fund.

In addition, life assurance companies are required to supply the supervision with certain documents. Section 3 is concerned with registration of insurance companies and duty to report. Section 4 is concerned with the supervision of insurance companies. Section 5 concerns insurance companies operating when the Act takes effect.