The first successful Part VII transfer heralds a new era
for run-off at Lloyd's.
Lloyd's made history when High Court approval was granted for the first ever Part VII transfer. It will see the business written by Lloyd's Syndicate 982 transferred out of the Lloyd's market to Sterling Life Limited in the company market.
This is the first portfolio of business to move between a Lloyd's syndicate and an insurance company since Equitas, and the first to move since the Financial Services and Markets Act introduced the new procedure governing transfers between Lloyd's and insurance companies. It provides an entirely new option for achieving finality at Lloyd's. The liabilities of open years of syndicates in run-off is currently estimated to be in excess of £7bn.
Spectrum Syndicate Management carried out the transfer of Syndicate 982, but Spectrum's chief executive Richard Murphy does not believe it will lead to a huge leap in the number of similar applications from syndicates currently in run-off. “This was in many respects the ideal syndicate to undertake the first part VII transfer from the Lloyd's Market,” he said. “It is one of a few life syndicates and has a small number of policyholders, the vast majority of which were in the UK and Europe.”
“The process was a complex one. There are significant differences in terms of the transfer of a Lloyd's syndicate, and we have learned a great deal about the solutions needed to meet those particular challenges,” Murphy added.