LexGo

Clarifications on the validity of insurance contracts concluded by UK insurance undertakings in a post-Brexit context
03/02/2021

Validity of insurance contracts concluded by UK insurance undertakings in a post-Brexit context – Clarifications by the Luxembourg legislator

The Luxembourg legislator recently amended the law of 27 July 1997 on insurance contracts, as amended (the “1997 Law”) in adopting the law of 19 December 2020 on the budget of State revenue and expenditure for the financial year 2021. In particular, this amendment clarifies the post-Brexit validity of insurance contracts concluded by UK insurance undertakings prior to the end of the Brexit transition period on 31 December 2020.

Specifically, a new paragraph has been inserted into Article 2 of the 1997 Law, which reads as follows:

“An insurance contract remains valid and its execution remains subject to the present law, in the event that an insurance undertaking from the European Economic Area or a third country loses its approval to carry out direct insurance operations in the Grand Duchy of Luxembourg while retaining its authorisation in its home State and that this contract has been validly issued or renewed by an undertaking authorised to work in the Grand Duchy of Luxembourg under the freedom of establishment or the freedom to provide services at the time of issue or renewal of this contract.

Such a contract may not, however, be renewed or be the subject of any direct insurance transaction giving rise to the issue of premiums after the loss of authorisation.” 1

With this amendment, the Luxembourg legislator confirms that insurance contracts entered into by UK insurance undertakings which did not decide to transfer to an EU carrier prior to the end of the Brexit transition period remain valid post-Brexit. However, such contracts may neither be renewed nor give rise to the payment of any premiums after the 31 December 2020 deadline.

 

1 Translation published on the CAA’s website.

Related : Arendt ( Mr. Pierre-MichaĆ«l de Waersegger ,  Mrs. Emmanuelle Mousel )

[+ http://www.arendt.com]

Mr. Pierre-Michaƫl de Waersegger Mr. Pierre-Michaƫl de Waersegger
Partner
pierre-michael.dewaersegger@arendt.com
Mrs. Emmanuelle Mousel Mrs. Emmanuelle Mousel
Counsel
emmanuelle.mousel@arendt.com

Lastest articles by Mr. Pierre-Michaƫl de Waersegger

New CAA AML/CTF regulation
11/09/2020

The aim of the New Regulation is to replace and repeal the amended CAA Regulation No. 13/01 of 23 December 2013 ...

Read more

EIOPA guidelines on outsourcing to cloud service providers
17/07/2020

On 6 February 2020, the European Insurance and Occupational Pensions Authority (“EIOPA”) has published its fin...

Read more

MiFID II: Third country (national) regime ā€“ a first list of "equivalent" jurisdictions and terr...
10/07/2020

On 1st July 2020, the CSSF released its Circular 20/743, thereby partially amending Circular letter 19/716. On the sa...

Read more

Brexit Impact On Insurance Undertakings - Clarifications By The Luxembourg Supervisory Authority
20/04/2020

In two information notices dated April 2 and April 8, 2020, the Commissariat Aux Assurances (“CAA”)&...

Read more

Lastest articles by Mrs. Emmanuelle Mousel

New CAA AML/CTF regulation
11/09/2020

The aim of the New Regulation is to replace and repeal the amended CAA Regulation No. 13/01 of 23 December 2013 ...

Read more

EIOPA guidelines on outsourcing to cloud service providers
17/07/2020

On 6 February 2020, the European Insurance and Occupational Pensions Authority (“EIOPA”) has published its fin...

Read more

Brexit Impact On Insurance Undertakings - Clarifications By The Luxembourg Supervisory Authority
20/04/2020

In two information notices dated April 2 and April 8, 2020, the Commissariat Aux Assurances (“CAA”)&...

Read more

LexGO Network