Reinsured Names are in for a £50m windfall according to an announcement by Equitas.
Equitas confirmed yesterday that it intends to pay an initial return premium upon implementation of Phase 1 of the agreement with National Indemnity, which will see the US insurer take on the run-off of Equitas while providing up to $7bn of additional reinsurance cover.
The proposed initial payment of £50m is also subject to approval by the FSA. To be eligible for any payment due, Reinsured Names must confirm details of their address to Equitas on a form which has also been sent to them with the information document.
Equitas also informed Names of three consultation meetings to be held in January. The meetings for will be held in Edinburgh on 15 January 2007, Manchester on 18 January 2007 and London on 19 January 2007.
Further details on the planned implementation of the National Indemnity agreement were also released. Equitas stated that the first phase of the agreement will come into effect when three conditions are satisfied:
• The Financial Services Authority gives all necessary approvals;
• The Superintendent of Insurance of the State of New York consents to the withdrawal and application of the assets held in the Equitas American Trust Fund towards payment of the premium;
• The Equitas Trustees approve the agreement.
Should these conditions not be met by 31 March 2007, the agreement will be terminated.
