Recently Rhode Island revised its Voluntary Restructuring of Solvent Insurers Act as implemented by DBR Regulation 68. This was, in many respects, modeled after the UK’s Part VII Transaction, which, subject to court approval, enables an insurance company to transfer/novate a book of business (and divest itself of all residual liability), to another unrelated insurer which assumes all liabilities associated with that business. Reg 68 is not as broad as the Part VII legislation, but nevertheless creates an option in the United States that had not heretofore been available. A number of Locke Lord US attorneys have been involved in Part VII Transfers, and thus are very familiar with the mechanism.
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