Insurance business transfer schemes
Produced in partnership with Geraldine Quirk of Bryan Cave Leighton Paisner
Insurance business transfer schemes

The following Restructuring & Insolvency practice note Produced in partnership with Geraldine Quirk of Bryan Cave Leighton Paisner provides comprehensive and up to date legal information covering:

  • Insurance business transfer schemes
  • Brexit impact
  • Transactions qualifying as insurance business transfer schemes
  • Transfers at Lloyd's
  • Overview of the Part VII process
  • Initial due diligence and planning
  • The role of the regulator
  • Consultation with EEA regulators
  • The independent expert report
  • Notification requirements: application
  • More...

IP COMPLETION DAY: 11pm (GMT) on 31 December 2020 marks the end of the Brexit transition/implementation period entered into following the UK’s withdrawal from the EU. At this point in time (referred to in UK law as ‘IP completion day’), key transitional arrangements come to an end and significant changes begin to take effect across the UK’s legal regime. This document contains guidance on subjects impacted by these changes. Before continuing your research, see Practice Note: What does IP completion day mean for R&I?

Consistent with the common law of contract, an insurer is not able to transfer the burden of its obligations under a contract of insurance without the consent of the policyholder. A novation agreement between the original insurer, the policyholder and the substitute insurer is, as a general rule, required to effect such a transfer.

As an exception to this rule, an insurance business transfer scheme under Part VII of the Financial Services and Markets Act 2000 (FSMA 2000) provides a process by which an insurer may transfer the whole or part of its business, subject to certain conditions, without obtaining the consent of individual policyholders.

The UK has had a regime for transferring portfolios of business for some time. Earlier procedures under the Insurance Companies Act 1982 differed in the case of long-term insurance (essentially life, annuity, permanent health and pension business) and

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