RE TRANSAMERICA LIFE INSURANCE CO

RE TRANSAMERICA LIFE INSURANCE CO

The court will sanction the s.24 transfer only if statutory notices, independent actuary's report and regulatory authorizations are satisfactory and no class of policyholders will be materially adversely affected; here the independent actuary and Insurance Authority found no material adverse effect and the transferee has sufficient assets and contractual supports, but sanction is conditional on the Companies providing a limited indemnity/undertaking in respect of excise tax and any additional tax liability arising solely from the change to a non-U.S. issuer and undertakings on conversion pricing, failing which the petition will be dismissed.

Citation
RE TRANSAMERICA LIFE INSURANCE CO
Parties
Petitioner: Transamerica Life Insurance Company; Petitioner: Transamerica Life (Bermuda) Limited; Respondent/regulator: Insurance Authority; Objector/policyholder: Charles S. Monat; Objector/insurance Broker: Charles Monat Associates Ltd
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
27 March 2013
Case Number
HCMP2872/2012
Procedural Posture
Section 24 Petition Under the Insurance Companies Ordinance (cap.41) for Transfer of Long Term Business / Judgment on Sanction Hearing (court of First Instance)
Outcome
Petition conditionally approved subject to the Companies providing the specified limited indemnity and undertakings; if Companies do not agree to provide the indemnity the petition will be dismissed; liberty to apply within 7 days
Legal Topics
Scheme of Transfer Under S.24, Policyholder Protection, Actuarial Report, Regulatory Authorization, Tax Indemnity and Undertakings, Conversion Rights
Source Language
EN
Insurance Law Company Law Tax Law Civil Procedure Scheme of Transfer Under S.24 Policyholder Protection Actuarial Report Regulatory Authorization +2 more

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Parties

Transamerica Life Insurance Company

Petitioner

Transamerica Life (Bermuda) Limited

Petitioner

Insurance Authority

Respondent/regulator

Charles S. Monat

Objector/policyholder

Charles Monat Associates Ltd

Objector/insurance Broker

Procedural Posture

Section 24 Petition Under the Insurance Companies Ordinance (cap.41) for Transfer of Long Term Business / Judgment on Sanction Hearing (court of First Instance)

Legal Issues

  1. 1 Whether the s.24 statutory requirements and regulatory authorizations are satisfied
  2. 2 Whether any class of policyholders will be materially adversely affected by the proposed transfer
  3. 3 Whether the independent actuary's report supports non-adverse effect

Ratio Decidendi

The court will sanction the s.24 transfer only if statutory notices, independent actuary's report and regulatory authorizations are satisfactory and no class of policyholders will be materially adversely affected; here the independent actuary and Insurance Authority found no material adverse effect and the transferee has sufficient assets and contractual supports, but sanction is conditional on the Companies providing a limited indemnity/undertaking in respect of excise tax and any additional tax liability arising solely from the change to a non-U.S. issuer and undertakings on conversion pricing, failing which the petition will be dismissed.

Court Disposition

Petition conditionally approved subject to the Companies providing the specified limited indemnity and undertakings; if Companies do not agree to provide the indemnity the petition will be dismissed; liberty to apply within 7 days

Orders

  • TLIC to pay the costs of the petition including costs of the Insurance Authority to be taxed on a common fund basis if not agreed
  • Liberty to apply to the Companies within 7 days from date of judgment regarding the indemnity