Rothesay Life Plc, Re

Rothesay Life Plc, Re

The scheme does not put any affected policyholders in a materially worse position than if it were not implemented. The transfer is necessary to ensure lawful servicing and payment of policies after Brexit, and the possible disadvantages (including potential loss of FSCS protection and regulatory differences) are outweighed by the benefits and are not material. The independent expert's analysis, supported by the PRA and FCA, is reasonable. COVID-19 does not create asymmetric risk between the companies. The court exercises its discretion to sanction the scheme.

Parties
Applicant: Rothesay Life plc; Applicant: Monument Life Insurance DAC
Jurisdiction
England and Wales
Judgment Date
07 August 2020
Procedural Posture
Part VII FSMA Transfer Scheme (insurance Business Transfer) / Final Approval Judgment
Outcome
Scheme sanctioned; transfer approved
Legal Topics
Part VII Transfer, Solvency II, Brexit Contingency Planning, Policyholder Protection, FSCS Coverage, Cross Border Insurance Transfers
Insurance Law Financial Services Regulation Part VII Transfer Solvency II Brexit Contingency Planning Policyholder Protection FSCS Coverage Cross Border Insurance Transfers

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Parties

Rothesay Life plc

Applicant

Monument Life Insurance DAC

Applicant

Procedural Posture

Part VII FSMA Transfer Scheme (insurance Business Transfer) / Final Approval Judgment

Legal Issues

  1. 1 Whether the proposed transfer of insurance policies from Rothesay Life plc to Monument Life Insurance DAC under Part VII FSMA should be sanctioned by the court
  2. 2 Whether the transfer would have a material adverse effect on the security of benefits or reasonable expectations of policyholders
  3. 3 Whether the possible loss of FSCS protection or regulatory differences between the UK and Ireland justify refusal of the scheme

Ratio Decidendi

The scheme does not put any affected policyholders in a materially worse position than if it were not implemented. The transfer is necessary to ensure lawful servicing and payment of policies after Brexit, and the possible disadvantages (including potential loss of FSCS protection and regulatory differences) are outweighed by the benefits and are not material. The independent expert's analysis, supported by the PRA and FCA, is reasonable. COVID-19 does not create asymmetric risk between the companies. The court exercises its discretion to sanction the scheme.

Court Disposition

Scheme sanctioned; transfer approved

Orders

  • The transfer of the specified insurance policies from Rothesay Life plc to Monument Life Insurance DAC under Part VII FSMA is sanctioned and approved.