Insurance Companies Act 1982 (repealed)

Transfers of general business U.K.

51 Approval of transfers of general business. U.K.

(1) Where it is proposed to execute an instrument by which an insurance company to which this Part of this Act applies (“the transferor”) is to transfer to another body (“the transferee") all its rights and obligations under such general policies, or general policies of such descriptions, as may be specified in the instrument, the transferor may apply to the Secretary of State for his approval of the transfer.

(2) The Secretary of State shall not determine an application made under subsection (1) above unless he is satisfied that—

(a) a notice approved by him for the purpose has been published in the London, Edinburgh and Belfast Gazettes and, if he thinks fit, in two national newspapers which have been so approved; and

(b) except in so far as he has otherwise directed, a copy of the notice has been sent to every affected policy holder and every other person who claims an interest in a policy included in the transfer and has given written notice of his claim to the transferor; and

(c) copies of a statement setting out particulars of the transfer and approved by him for the purpose have been available for inspection at one or more places in the United Kingdom for a period of not less than thirty days beginning with the date of the first publication of the notice in accordance with paragraph (a) above.

(3) The notice referred to in subsection (2) above shall include a statement that written representations concerning the transfer may be sent to the Secretary of State before a specified day, which shall not be earlier than sixty days after the day of the first publication of the notice in accordance with paragraph (a) above; and the Secretary of State shall not determine the application until after considering any representations made to him before the specified day.

(4) The Secretary of State shall not approve a transfer on an application under subsection (1) above unless he is satisfied that—

(a) every policy included in the transfer evidences a contract which—

(i) was entered into before the date of the application; and

(ii) imposes on the insurer obligations the performance of which will constitute the carrying on of insurance business in the United Kingdom; and

(b) the transferee is, or immediately after the approval will be, authorised under section 3 or 4 above to carry on in the United Kingdom insurance business of the appropriate class or classes;

and unless in his opinion the transferee’s financial resources and the other circumstances of the case justify the giving of his approval.

[F1 (4A) Without prejudice to the generality of subsection (4) above, the Secretary of State shall not approve a transfer on an application under subsection (1) above to an insurance company whose head office is situated in another member State unless the supervisory authorities of that State certify that it possesses the necessary margin of solvency after taking the proposed transfer into account.

(4B) Notwithstanding the provisions of subsection (4)(a)(ii) and (b) above, the Secretary of State may approve a transfer on an application under subsection (1) above to an insurance company established in another member State, where he is satisfied that–

(a) the transfer relates to policies covering risks situated in the United Kingdom,

(b) the transferee is entitled in accordance with section 81B below to provide insurance in the United Kingdom in respect of those risks through that establishment, and

(c) the supervisory authorities of the member State of that establishment agree to the transfer.]

(5) On determining an application made under subsection (1) above, the Secretary of State shall—

(a) publish a notice of his decision in the London, Edinburgh and Belfast Gazettes and in such other manner as he may think fit, and

(b) send a copy of that notice to the transferor, the transferee and every person who made representations in accordance with the notice referred to in subsection (2) above;

and if he refuses the application he shall inform the transferor and the transferee in writing of the reasons for his refusal.

(6) Any notice or other document authorised or required to be given or served under this section or section 52 below may, without prejudice to any other method of service, be served by post; and a letter containing the notice or other document shall be deemed to be properly addressed if it is addressed to that person at his last known residence or last known place of business in the United Kingdom.

(7) In this section “general policy” means a policy evidencing a contract the effecting of which constituted the carrying on of general business; and for the purposes of this section a policy holder is an “affected policy holder” in relation to a proposed transfer if—

(a) his policy is included in the transfer, or

(b) his policy is with the transferor and the Secretary of State has certified, after consulting the transferor, that in the opinion of the Secretary of State the policy holder’s rights and obligations under the policy will or may be materially affected by the transfer.

Textual Amendments

F1 S. 51(4A)(4B) inserted by S.I. 1990/1333, reg. 9(1)

F2 52 Effect of approval under section 51. U.K.

(1) Subject to subsection (2) below, an instrument giving effect to a transfer approved by the Secretary of State under section 51 above shall be effectual in law—

(a) to transfer to the transferee all the transferor’s rights and obligations under the policies included in the instrument, and

(b) if the instrument so provides, to secure the continuation by or against the transferee of any legal proceedings by or against the transferor which relate to those rights or obligations.

notwithstanding the absence of any agreements or consents which would otherwise be necessary for it to be effectual in law for those purposes.

(2) Except in so far as the Secretary of State may otherwise direct, a policy holder whose policy is included in such an instrument shall not be bound by it unless he has been given written notice of its execution by the transferor or the transferee.

Textual Amendments

F2 S. 49 substituted for ss. 49-52 (1.7.1994) by S.I. 1994/1696, reg. 28(1)(3)

[F3 52A Issue of certificates by Secretary of State. U.K.

(1) Where it is proposed to execute an instrument by which an insurance company established in another member State is to transfer to an insurance company whose head office is situated in the United Kingdom all its rights and obligations under such general policies, or general policies of such descriptions, as may be specified in the instrument, the Secretary of State may, if he is satisfied that the latter insurance company possesses the necessary margins of solvency after taking the proposed transfer into account, issue a certificate to that effect.

(2) In this section “general policy" means a policy evidencing a contract the effecting of which constituted the carrying on of general business, other than reinsurance.]

Textual Amendments

F3 S. 52A inserted by S.I. 1990/1333, reg. 9(2)

Valid from 01/07/1994

[F4 52B Effect of transfers authorised in other EEA States. U.K.

(1) This section applies where—

(a) an EC company transfers to another body all its rights and obligations under any UK policies and the transfer is authorised in its home State in accordance with—

(i) Article 11 of the third long term insurance Directive, or

(ii) Article 12 of the third general insurance Directive;

(b) a non-EC company whose head office is in an EFTA State transfers to another body all its rights and obligations under any UK policies and the transfer is authorised in an EEA State other than the United Kingdom in accordance with—

(i) Article 6 of the second long term insurance Directive, or

(ii) Article 11 of the second general insurance Directive; or

(c) a non-EC company whose head office is not in an EFTA State transfers to another body all its rights and obligations under any UK policies and the transfer is authorised in a member State other than the United Kingdom in accordance with—

(i) Article 31a of the first long term insurance Directive (as amended by Article 49 of the third long term insurance Directive), or

(ii) Article 28a of the first general insurance Directive (as amended by Article 53 of the third general insurance Directive).

(2) If notice of the execution of the instrument giving effect to the transfer is published in such manner as the Secretary of State may from time to time direct, the instrument shall be effectual in law—

(a) to transfer to the transferee all the transferor’s rights and obligations under the UK policies included in the instrument, and

(b) if the instrument so provides, to secure the continuation by or against the transferee of any legal proceedings by or against the transferor which relate to those rights or obligations,

notwithstanding the absence of any agreements or consents which would otherwise be necessary for it to be effectual in law for those purposes.

(3) Directions under this section may make different provision for different cases or descriptions of case.

(4) A policy which evidences a contract of direct insurance is a UK policy for the purposes of this section if the law applicable to it is the law of any part of the United Kingdom.]

Textual Amendments

F4 S. 52B inserted (1.7.1994) by S.I. 1994/1696, reg. 30