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Transfer of a book of business made up of Pension and Life Business from Canada Life to Scottish Friendly

What is happening?

In June 2018 Scottish Friendly signed a transfer agreement to purchase a book of business made up of a wide range of Life, Pensions and Protection business from Canada Life. Subject to approval from members, regulators and the High Court in England and Wales, in accordance with the terms of the Scheme, these policies will be transferred to Scottish Friendly on 1st November 2019.

Information on the proposed transfer

An Independent Expert, Simon Grout of Oliver Wyman, was appointed and approved by the Prudential Regulation Authority (PRA) to report on the effects of the transfer on policyholders. This includes the financial security of the legal entities involved. The Independent Expert provides his conclusions in the Independent Expert’s Report which will be considered by the Court prior to sanctioning the transfer.

A Part VII transfer is the legal process to transfer insurance business from one insurance company to another. The transfer can only take place with the approval of the Court. The Court will receive reports from the UK financial services regulators, the PRA and the Financial Conduct Authority (FCA), as well as the Independent Expert.

The Independent Expert has currently prepared two documents:

  • Independent Expert’s Report: This report details the effects of the transfer on both Canada Life and Scottish Friendly policyholders and how each conclusion has been reached.
  • Independent Expert’s summary report: This report provides an overview of the transfer and sets out the Independent Expert’s conclusions on the effect of the transfer on policyholders. It's been created to give policyholders a good understanding of the terms of the scheme and the consequences for their policies.

You can find the Independent Expert’s full report and summary of the report in the ‘Important Documents’ section below. The Independent Expert will publish a supplementary report before the final court hearing (Sanctions Hearing), which is expected to take place on 22nd October 2019.

The Chief Actuary and the With-Profits Actuary of Scottish Friendly, have each written their own reports on the effects of the transfer. You can find both these reports in the ‘Important Document’ Section below.

Further supplementary reports from the Actuaries will also be made available prior to the Sanctions Hearing. These documents will outline any changes since the first reports outlined above.

The Scheme Document is the legal document that sets out the terms of the transfer in the UK. You can find a copy of the Full Scheme and a Summary of the Scheme in the ‘Important Documents’ section below.

Additionally, you will find copies of the explanatory note sent to the Delegates of Scottish Friendly ahead of the Special General Meeting (SGM) on 16th July 2019 where a vote will be held on the proposed transfer of business.

Important Documents

Jersey and Guernsey policyholders

The transferring business includes a small number of policies which comprise business carried on in or from within Jersey or Guernsey, or which are held by people resident in Jersey or Guernsey. The transfer of these policies is subject to the approval of separate schemes by the Royal Courts in Jersey and Guernsey, which will be on substantially the same terms as the UK transfer. We refer to these as the "overseas schemes".

You can find further details about the overseas schemes in Appendix 3 to the Customer Guide. The court hearings to consider the overseas schemes are expected to take place as follows:

  • Jersey scheme: 28 October 2019 at 10 am at the Royal Court of Jersey, Royal Court Building, Royal Square, St Helier, Jersey JE1 1JG
  • Guernsey scheme: 25 October 2019 at 9.30 am at the Royal Court of Guernsey, The Royal Court House, St Peter Port, Guernsey, GY1 2NZ

If approved, the overseas schemes are expected to be implemented at the same time as the UK transfer, on 1 November 2019.

You can find the drafts of the legal documents setting out the terms of the overseas schemes below:

Contact us

If you wish to contact us in relation to this Part VII, please call 0333 323 5433 or write to us at Scottish Friendly Assurance Society Limited, Scottish Friendly House, 16 Blythswood Square, Glasgow G2 4HJ

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