The Insurers (Winding-Up) Rules (Northern Ireland) 2005

Explanatory Note

(This note is not part of the Rules.)

These Rules supplement the Insolvency Rules (Northern Ireland) 1991 in relation to the winding-up of insurers in Northern Ireland. They revoke, and re-make with modifications, the Insurance Companies (Winding-Up) Rules (Northern Ireland) 1992.

Rule 6 and Schedule 1 provide for the valuation rules in relation to a company’s general business policies. Rules 7 and 8 and Schedules 2 to 5 provide for the valuation rules in relation to a company’s long-term business policies. They introduce new requirements in relation to the valuation of unitised with-profits policies, specify that the interest rate or rates used to calculate the present value of future payments must be fair and reasonable and change the basis of valuation from a modified net premium basis to a gross premium basis.

Rules 9 and 10 make provision for the attribution of liabilities and assets to a company’s long-term business in cases of doubt. Rule 12 requires a liquidator to obtain actuarial advice before taking certain courses of action.

Rule 15 allows the Department to require that assets of a company, representing its long-term business, be held by a trustee. Rules 17 and 18 oblige the liquidator to comply with certain requirements imposed on him by the Department in relation, for example, to refraining from making certain investments and to the provision of information and accounts.

Rule 21 allows a liquidator to accept late payments of premiums and to compensate policy holders whose policies have lapsed. Rule 25 relates to the remuneration of a liquidator. Rule 27 stipulates various notice requirements where a stop order has been made.