Insolvency of insurers

Insolvency laws make special provisions for insurance companies because of the regulated status of the industry and the importance of insurance to the economy.

Insolvency procedures for insurance companies

For information on the insolvency procedures available to insolvent insurance companies, see Practice Note: Insolvency of insurers.

The Corporate Insolvency and Governance Act 2020 (CIGA 2020) made amendments to the Insolvency Act 1986 (IA 1986), including the insertion of a new moratorium process and restrictions on ipso facto clauses.

To view the latest version of this document and thousands of others like it, sign-in with LexisNexis or register for a free trial.

TAKE A FREE TRIAL

Latest Insurance & Reinsurance News

IAIS and FSI release joint note examining parametric insurance for natural catastrophe risks

The International Association of Insurance Supervisors (IAIS) and the Bank for International Settlements' Financial Stability Institute (FSI) have jointly published a note entitled ‘Uncertain waters: can parametric insurance help bridge NatCat protection gaps?’. The note examines how key design elements such as index selection, trigger mechanisms and payout structures can enhance the adoption of parametric insurance against natural catastrophe.

IAIS releases 2024 Global Insurance Market Report

The International Association of Insurance Supervisors (IAIS) has published its annual Global Insurance Market Report (GIMAR) for 2024, highlighting key risks and trends facing the global insurance sector. The report, derived from 59 major international insurance groups, indicates a 5.3% increase in systemic risk scores for participating insurers at the end of 2023, predominantly due to a rise in illiquid, hard-to-value assets. However, the report found that overall, insurers’ systemic risk scores remained significantly lower than those of banks, indicating that the insurance sector has a lower systemic risk footprint.

PRA modification by consent for Solvency II firms with US-parented groups

The Prudential Regulation Authority (PRA) has published a direction for modification by consent (MbC) of rules 20.1 and 20.2 of the Group Supervision part of the PRA Rulebook for Solvency II firms. The MbC is available to PRA authorised insurance and reinsurance undertakings, the parent undertaking of which is an insurance holding company or mixed financial holding company which has its head office in the United States. The direction is effective from 31 December 2024.

MHCLG consults on permitted insurance fees for landlords and freeholders

The Ministry of Housing, Communities and Local Government (MHCLG) has launched a consultation, seeking views on introducing permitted insurance fees for landlords, freeholders, and property managing agents, pursuant to measures in the Leasehold and Freehold Reform Act 2024, which addresses concerns over opaque and excessive charges imposed on leaseholders for building insurance. The proposals suggest replacing the current commission-based remuneration system with a transparent fee structure that reflects the work involved in arranging and managing building insurance. The consultation seeks views on the activities to be covered by the permitted fee, how it should be calculated, and additional criteria to ensure fairness and proportionality. The responses received will inform secondary legislation that will define the parameters of the permitted fee. The consultation closes on 24 February 2025.

View Insurance & Reinsurance by content type :

News