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Part VII Portfolio Transfer

More and more businesses are acknowledging the importance of proactively dealing with discontinued liabilities. Increased regulatory capital requirements to underwrite business, growing expectations of shareholders and the rising influence of rating agencies are just some of the reasons why.

PRO has a market-leading focus on developing strategies that bring finality to discontinued liabilities. This allows our clients to achieve closure of portfolios and, where possible, release surplus capital.

Part VII Portfolio Transfer is a mechanism for transferring general insurance business, ranging from single contracts to an entire portfolio, to another insurer. This procedure is set out in the Financial Services and Markets Act 2000 (FSMA2000). Following Court approval, it provides the power to transfer assets as well as liabilities of the transferring business. Such assets can include the cash supporting reserves, the reinsurance assets and trust funds.

The advantages of Part VII Transfers are that they offer finality to the transferor and have the flexibility to be applied to portfolios or whole books, they also have considerable benefits for the collapse of complex (re)insurance pools. Following transfer the court has power to make an order for the dissolution of the transferor.

Our experienced team is able to help with all aspects of the transfer, including identifying and preparing the business to be transferred and the preparation of the report by the independent expert, as required by FSMA2000.