Insurance firms in run-off

Overview

The prudential issues insurers must consider when entering into run-off, and for the duration of the run-off, are listed below.

We also refer firms to a letter we issued in July 2016 reminding firms of their continuing responsibilities in the way they interact with us when in run-off. The letter includes reference to Threshold Conditions, Fundamental Rules and the PRA Rulebook.

These requirements cover prudential issues only. For conduct issues, firms should contact the Financial Conduct Authority (FCA).

UK regulatory reporting requirements

• Reporting requirements for Solvency II firms
• Reporting requirements for non-Directive firms

The removal of effecting permissions

• Removal of effecting permissions: Solvency II firms
• Removal of effecting permissions: non-Directive firms

Applications to remove permissions must be submitted as a variation of permissions notification via the Financial Conduct Authority's Connect system. 

Submitting a draft scheme of operations

• Submitting schemes of operation: Solvency II firms
• Submitting schemes of operation: non-Directive firms

We will expect the scheme of operations to include the wording that addresses our expectations, as set out in Capital extractions by run-off firms within the general insurance sector - SS4/14, which are that:

• firms in run-off hold sufficient regulatory capital to continue to meet their obligations to policyholders as they fall due for the duration of the run-off
• firms satisfy themselves and us that this remains the case after a proposed capital extraction.

We provided further details to firms as to the information required for Supervision to make this decision in a letter to CEOs on 'Capital extractions by insurance firms in run-off' published in April 2018.

Obligations on firms which have previously submitted a scheme of operations

• Previously submitted schemes of operation: Solvency II firms 
• Previously submitted schemes of operation: non-Directive firms

Part IV cancellations

• Part IV cancellations: Solvency II firms
• Part IV cancellations: non-Directive firms

Applications for Part IV cancellations must be submitted via the FCA's Connect system.