Dormant Assets Act 2022

2 Transfer of eligible insurance proceeds to reclaim fund

(1) This section applies where—

(a) an insurance institution transfers to an authorised reclaim fund dormant eligible insurance proceeds owing to a person, and

(b) the reclaim fund consents to the transfer.

(2) On the transfer of the eligible insurance proceeds—

(a) a person to whom the proceeds are payable immediately before the transfer ceases to have any right against any insurance institution to payment of the proceeds, but

(b) that person acquires against the reclaim fund whatever right to payment of the proceeds the person would have had against the institution if the transfer had not happened.

(3) In this Act “insurance institution”, in relation to any eligible insurance proceeds, means (subject to subsection (4)) a person who—

(a) under Part 4A of FSMA 2000 has permission to perform a regulated activity for the purposes of FSMA 2000 by virtue of article 10(2) of the RAO 2001 (carrying out a contract of insurance as principal),

(b) owes the proceeds in the course of, or in connection with, that regulated activity, and

(c) has its head office or an establishment in the United Kingdom.

(4) “Insurance institution” does not include—

(a) a mutual insurer, or

(b) a person who is specified, or is within a class of persons specified, by an order under section 38 of FSMA 2000 (exemption orders).