Transitional Provisions and Schedules

Part

Integrated Prudential sourcebook

Chapter

Transitional Provisions and Schedules

Printed on: 07/11/2024

Rulebook at: 14/01/2005

Transitional Provisions and Schedules

PRU TP 1

Transitional Provisions

PRU TP 1.1

Transitional Provisions

(1)

(2)

(3)

(4)

(5)

(6)

Material to which the transitional provision applies

Transitional provision

Transitional provision: dates in force

Handbook provision: coming into force

PRU 9.2.7 R

PRU 9.2.7 R (Requirement to hold professional indemnity insurance) does not apply in respect of acts or omissions occurring before:
(1) 31 October 2004 (in relation to mortgage mediation activity); and
(2) 14 January 2005 (in relation to insurance mediation activity).

From 31 October 2004

31 October 2004

PRU 9.3.53 R and PRU 9.3.57R (3)

A firm is not required to include goodwill in its intangible assets until 14 January 2008.

From 31 October 2004 until 14 January 2008

31 October 2004

[deleted]

Rules in PRU listed in the Table at PRU TR Table 10R

(1) A rule listed in column (2) is disapplied, or is modified in its application, to a firm;
(a) in order to produce the same effect, including any conditions, as a waiver had on the corresponding rule in IPRU(INS);
(b) for the same period as the waiver would have lasted, if shorter than the period in column (5);
provided the conditions set out in (2) are satisfied.
(2) The conditions referred to in (1) are:
(a) the rule is shown in the Table at PRU TR Table 10R as corresponding with the rule in IPRU(INS) in relation to which the waiver was granted to the firm;
(b) the waiver was current as respects the firm immediately before the date specified in column (6); and
(c) there is no specific transitional rule relating to the waiver.
(3) (1) does not have effect if, and to the extent that, it would be inconsistent with any community obligation of the United Kingdom.

From 31 December 2004 until the relevant rule is revoked

31 December 2004

PRU 9.4.5 R and PRU 9.4.7 R

PRU 9.4.5 R and PRU 9.4.7 R have effect in respect of the use by a firm of the services of another person consisting of insurance mediation and provided from an establishment in an EEA State that has not implemented Article 3 (Registration) of the IMD, as if the condition in paragraph (4) of PRU 9.4.5 R and the condition in paragraph (2) of PRU 9.4.7 R were a condition that the firm has no reason to doubt the good repute, competence and financial standing of that person.

14 January 2005 to 14 January 2006

14 January 2005

Rules in PRU not listed in the Table at PRU TR Table 10R

(1) A rule listed in column (2) is disapplied, or is modified in its application, to a firm:
(a) in order to produce the same effect, including any conditions, as a waiver had on a rule in IPRU(INS) or IPRU(FSOC), or a written concession had on a pre-commencement provision listed in PRU TR 7R;
(b) for the same period as the waiver or written concession would have lasted, if shorter than the period in column (5); provided the conditions set out in (2) are satisfied.
(2) The conditions referred to in (1) are:
(a) the rule in PRU is substantially similar to the rule in IPRU(INS), IPRU(FSOC), or the pre-commencement provision, as the case may be, with which the waiver or written concession was concerned;
(b) the waiver or written concession was current as respects the firm immediately before the date specified in column (6);
(c) there is no specific transitional rule relating to the waiver or written concession; and
(d) in the case of a written concession, it has not been superseded by a waiver from the FSA.
(3) (1) does not have effect if, and to the extent that, it would be inconsistent with any community obligation of the United Kingdom.

From 31 December 2004 until 30 June 2005

31 December 2004

As PRU TR 6R

The pre-commencement provisions referred to in these transitional provisions are those contained in:
(1) the Insurance Companies Act 1982 and relevant secondary legislation;
(2) the Friendly Societies Act 1992 and relevant secondary legislation.

As PRU TR 6R

As PRU TR 5R to PRU TR 7R

A firm which has the benefit of a waiver to which PRU TR 5R applies, or a waiver or written concession to which PRU TR 6R applies, must:
(1) notify the FSA immediately if it becomes aware of any matter which is material to the relevance or appropriateness of the waiver or written concession;
(2) maintain a written record of the rule in PRU to which it considers the waiver or written concession applies; and
(3) make the record available to the FSA on request.

As PRU TR 5R or PRU TR 6R

As PRU TR 6R

PRU TR 5R to PRU TR 25R

In these transitional provisions:
(1) "substantially similar" means substantially similar in purpose and effect;
(2) "written concession" means a waiver, exemption, concession, modification, consent, approval, determination or similar exercise of discretion which:
(a) disapplied, or tended to reduce the burden of complying with, a pre-commencement provision (with or without conditions); and
(b) was evidenced in writing.

As PRU TR 5R or PRU TR 6R

31 December 2004

PRU TR Table 10R

This Table belongs to PRU TR 5R to PRU TR 9R

Rules in PRU

Corresponding rules in IPRU(INS)

1.3.35R

4.2 (3)

2.1.9R

2.9 (3)

2.1.21R

2.9

2.1.22R

2.9

2.1.30R

2.4 (6)

2.2.80R

2.10 (7)

2.2.81R

2.10 (7)

2.2.86R

4.14

4.5 (7)

3.2.22R

4.14 (1)

4.2.34R

5.11

4.2.39R

5.11

5.11 (4)

5.11 (5)

5.11 (9)

5.11 (11)

4.2.58R

2.3 (2)

7.2.51R

2.4 (6)

7.2.56R

2.4 (1)

7.2.66R

Appendix 2.1 2.4(1)(b)

Appendix 2.2 2.4(1)(b)

5.9 (1)

7.3.40R

5.9 (2)

7.3.41R

5.9 (2)

7.3.43R

5.10

7.3.74R

5.16

8.3.17R(1)(a)-(b)

10.1

10.2

10.2 (1)

10.2 (2)

10.2 (3)

8.3.23R

10.2

10.2 (1)

10.2 (2)

10.2 (3)

PRU TR

(1)

(2)

(3)

(4)

(5)

(6)

Material to which the transitional provision applies

Transitional provision

Transitional provision: dates in force

Handbook provision: coming into force

PRU 1.2
PRU 5.1

If a firm, as at 31 December 2004, has the benefit of a waiver of:
(1) SUP 16.7.10 R ; or
(2) SUP 16.7.12 R ;
under which the firm does not have to supply adequate information on mismatch liquidity, the provisions referred to in column (2) do not apply.

From 31 December 2004 until the date the waiver referred to in column (4) ceases to have effect.

31 December 2004

PRU 1.3.5 R
PRU 7.4.191 R

(1) This rule applies to a firm which for the period specified in column (5) is required by PRU 1.3.5 R to measure the surplus or deficit in a defined benefits pension scheme, for the purposes of PRU, in accordance with FRS 17 (Retirement Benefits).(2) A firm must derecognise any measure of actuarial gains in respect of a defined benefits pension scheme.(3) A firm may deduct from its liabilities the difference between the measure of actuarial losses in respect of a defined benefits pension scheme which would result from the application of PRU 1.3.5 R and the firm's best estimate of the level of additional funding that it will provide for that defined benefits pension scheme over the next five years, as determined in conjunction with the scheme's actuaries or trustees (or both) as appropriate.

From 31 December 2004 to 30 December 2005

31 December 2004

PRU 1.3.14R

A firm will be treated as complying with the rule listed in column (2) if it marks to market by reference to market value as determined in accordance with generally accepted accounting concepts, bases and policies or other generally accepted methods appropriate to insurers.

From 31 December 2004 to 30 December 2006

31 December 2004

PRU 1.3.31 R PRU 2.2.90 R

(1) A firm may elect to apply PRU 1.3.11 R to shares in a regulated related undertaking that is not an insurance undertaking or an insurance holding company.
(2) A firm may apply PRU 1.3.11 R if it has made the election referred to in sub-paragraph (1) by written notice to the FSA in a way which complies with the requirements for written notice in SUP 15.7.
(3) Where a firm has made the election referred to in (1):
(a) PRU 2.2.90 R is disapplied in respect of the shares in that regulated related undertaking; and
(b) the shares in that regulated related undertaking must be valued in accordance with (4).
(4) Subject to (5), the shares in the regulated related undertaking within (3) must be valued in accordance with PRU 1.3.11 R.
(5) For the purposes of valuing the shares in a regulated related undertaking within (4), the value of those shares determined in accordance with PRU 1.3.11 R must be reduced:
(a) by an approximate amount, to the extent that the value of those shares in the regulated related undertaking cannot effectively be realised to meet the capital resources requirement of the firm; and
(b) by an approximate amount, to exclude value attributable to goodwill generated from the business of the regulated related undertaking with other members of the insurance group.

From 31 December 2004 until the first day of the firm's financial year beginning in 2005

31 December 2004

As PRU TR 14R

(1) The application of PRU 1.3.31 R to a regulated related undertaking which is not an insurance undertaking or an insurance holding company implements the amendments to the First Non-Life Directive, the First Life Directive and the Insurance Groups Directive in Articles 22(2), 23(2) and 28(6) of the Financial Groups Directive.
(2) PRU TR 14R allows the requirement to treat a regulated related undertaking which is not an insurance undertaking or an insurance holding company in accordance with PRU 1.3.31 R to be postponed until the effective date of the Financial Groups Directive.
(3) In the interim, a firm may elect either to apply PRU 1.3.11 R or to value shares in a regulated related undertaking which is not an insurance undertaking or an insurance holding company in accordance with PRU 1.3.31 R. The intention is to allow firms to continue to account for the value of shares held in these regulated related undertakings as they would formerly have done under IPRU(INS) for the purposes of calculating the capital resources of a firm.

As PRU TR 14R

PRU 2.2.93R (3)
PRU 2.2.101R (3)
PRU 2.2.101R (4)
PRU 2.2.102 R
PRU 2.2.103 R
PRU 2.2.105 R

(1) This paragraph applies to a firm which immediately before the date specified in column (6) had the benefit of a waiver in relation to IPRU(INS) rule 2.10 or 5.2, or a written concession in relation to a pre-commencement provision listed in PRU TR 7R, in either case allowing the firm to exclude from the calculation of its liabilities obligations under a particular capital instrument issued by the firm.
(2) Subject to (3) and to compliance with the conditions set out in (4), a firm will be treated as complying with a rule listed in column (2) in relation to the capital instrument to which the waiver or written concession referred to in (1) related so long as the firm is not obliged to pay any interest under the terms of the capital instrument in circumstances where the firm does not have capital resources equal to or in excess of its required margin of solvency under the Insurance Directives.
(3) (2) ceases to apply to a firm:
(a) once the firm has redeemed the capital instrument; or
(b) on or after any date upon which the firm has the option to redeem the capital instrument and may prudently do so.
(4) The conditions referred to in (2) are:
(a) the firm must notify the FSA immediately if it becomes aware of any matter which is material to the relevance or appropriateness of the waiver or written concession;
(b) the firm must maintain a written record of the rule in PRU to which it considers the waiver or written concession applies; and
(c) the firm must make the record available to the FSA on request.

From 31 December 2004 until the relevant rule is revoked

31 December 2004

PRU 2.2.93R (2)

(1) This paragraph applies to a firm carrying on with-profits insurance business which immediately before the date specified in column (6) had the benefit of a waiver in relation to IPRU(INS) rule 2.10 or 5.2 or a written concession in relation to a pre-commencement provision listed in PRU TR 7R in either case allowing the firm to exclude from the calculation of its liabilities obligations under a particular capital instrument issued by the firm.
(2) Subject to compliance with the conditions set out in (3), PRU 2.2.93R (2) does not apply in relation to the capital instrument to which the waiver or written concession referred to in (1) related provided that capital instrument was issued by the firm on or before 30 December 2004.
(3) The conditions referred to in (2) are:
(a) the firm must notify the FSA immediately if it becomes aware of any matter which is material to the relevance or appropriateness of the waiver or written concession;
(b) the firm must maintain a written record of the rule in PRU to which it considers the waiver or written concession applies; and
(c) the firm must make the record available to the FSA on request.

From 31 December 2004 until 30 December 2005

31 December 2004

PRU 2.2.108R (5)
PRU 2.2.108R (7)

(1) This rule applies to a firm which immediately before the date specified in column (6) had the benefit of a waiver in relation to IPRU(INS) rule 2.10 or 5.2, or a written concession in relation to a pre-commencement provision listed in PRU TR 7R, in either case allowing the firm to exclude from the calculation of its liabilities obligations under a particular capital instrument issued by the firm.
(2) Subject to compliance with the conditions set out in (3), a firm will be treated as complying with a rule listed in column (2) in relation to the capital instrument to which the waiver or written concession referred to in (1) related.
(3) The conditions referred to in (2) are:
(a) the firm must notify the FSA immediately if it becomes aware of any matter which is material to the relevance or appropriateness of the waiver or written concession;
(b) the firm must maintain a written record of the rule in PRU to which it considers the waiver or written concession applies; and
(c) the firm must make the record available to the FSA on request.

From 31 December 2004 until 30 June 2005

31 December 2004

PRU 2.2.108R (6)
PRU 2.2.108R (10)
PRU 2.2.108R (11)
PRU 2.2.111 R

From 31 December 2004 until the relevant rule is revoked

31 December 2004

PRU 2.2.12 R
PRU 2.2.14 R
(Table)

(1) This rule applies to a firm which immediately before the date specified in column (6) had the benefit of a waiver in relation to IPRU(INS) rule 2.10 (4).
(2) For the period specified in column (5) or the same period as the waiver would have lasted if shorter, subject to (3) and to compliance with the conditions set out in (4), for the purposes of calculating its capital resources a firm may include the value of claims against its members by way of calls for supplementary contributions as core tier one capital to the same extent as it was permitted by the waiver to include the value of those claims in the calculation of its margin of solvency.
(3) (2) does not apply for the purposes of PRU 2.2.18 R or SUP App 2.4.
(4) The conditions referred to in (2) are:
(a) the limits specified in the waiver on the extent to which the firm's claim against its members by way of call for supplementary contributions may be brought into account apply as if the reference (if any) in the waiver to the firm's required margin of solvency referred to its general insurance capital requirement and the reference (if any) in the waiver to the firm's margin of solvency referred to its capital resources; and
(b) the firm must comply with any further conditions imposed by the waiver.

From 31 December 2004 until the relevant rule is revoked

31 December 2004

PRU 2.2.12 R
PRU 2.2.14 R
(Table)

(1) This rule applies to a firm which immediately before the date specified in column (6) had the benefit of a waiver in relation to IPRU(INS) rule 2.10 (5) or IPRU(FSOC) rule 4.7 (3).
(2) For the period specified in column (5) or the same period as the waiver would have lasted if shorter, subject to (3) and to compliance with the conditions set out in (4), for the purpose of calculating its capital resources a firm may include the value of implicit items at Stage B of the calculation in PRU 2.2.14 R Table to the same extent to which it was permitted by the waiver to include the value of those implicit items in the calculation of its margin of solvency.
(3) (2) does not apply for the purposes of PRU 2.2.17 R.
(4) The conditions referred to in (2) are:
(a) the limits specified in the waiver on the extent to which the value of implicit items may be brought into account apply as if the reference (if any) in the waiver to the firm's required margin of solvency referred to its minimum capital requirement and the reference (if any) in the waiver to the firm's margin of solvency referred to its capital resources; and
(b) the firm must comply with any further conditions imposed by the waiver.

From 31 December 2004 until the relevant rule is revoked

31 December 2004

PRU 2.1.21 R
PRU 2.1.30 R
PRU 2.2.18 R
PRU 3.2.22 R
PRU 7.2.51 R
PRU 7.2.85 R

In relation to any financial year starting on or before 30 December 2004, a firm's general insurance capital requirement or a firm's insurance health risk capital component is its margin of solvency calculated in accordance with:
(1) IPRU(INS) rule 2.4 (excluding 2.4(1)(a)) and Appendices 2.1 and 2.2, or IPRU(INS) rule 2.4 (excluding 2.4(1)(a)) and Appendices 2.1 and 2.2 (as applied by rule 2.7 to long-term insurance business of class IV); or
(2) APER 3.1.4 G (excluding 4.2(1)(a)) and Appendix 2 Parts I and II, or APER 3.1.4 G (excluding 4.2(1)(a)) and Appendix 2 Parts I and II, (as applied by paragraph 3 of Appendix I to long-term insurance business of class IV);
as the case may be, as those rules had effect immediately prior to the date in column (6).

From 31 December 2004 until the relevant rule is revoked

31 December 2004

PRU 4.3.5 R (3)(b)
PRU 4.3.34 R
PRU 4.3.35 R

(1) PRU 4.3.5 R (3)(b) has effect as if the words "and is capable of valuation" and "to 4.3.35R" were omitted.
(2) PRU 4.3.34 R has effect as if it read "For the purpose of PRU 4.3.5 R (3)(b), a transaction is on approved terms only if the firm reasonably believes that it may be readily closed out".
(3) PRU 4.3.35 R does not apply.

From 31 December 2004 until 30 December 2005

31 December 2004

PRU 7.5.20 R
PRU 7.5.45 R

In relation to any financial year starting on or before 30 December 2004:
(1) a firm's non-credit equalisation provision is its equalisation reserve in respect of Part II business carried on by the firm calculated in accordance with IPRU(INS) rules 6.4 to 6.10 and Appendix 6.1 as those rules had effect immediately prior to the date in column (6); and
(2) a firm's credit equalisation provision is its equalisation reserve in respect of credit insurance business carried on by the firm calculated in accordance with IPRU(INS) rules 6.11 to 6.12 and Appendix 6.2 as those rules had effect immediately prior to the date in column (6).

From 31 December 2004 until the relevant rule is revoked.

31 December 2004

PRU 8.3.8 R
PRU 8.3.9 R
PRU 8.3.10 R
PRU 8.3.15 R

(1) For the purpose of the calculation of the group capital resources and group capital resources requirement of an undertaking referred to in PRU 8.3.17 R, a firm may elect not to take a regulated related undertaking, which is not an insurance undertaking or an insurance holding company, into account in accordance with PRU 8.3.33 R and PRU 8.3.36 R.
(2) A firm may elect not to take a regulated related undertaking, which is not an insurance undertaking or an insurance holding company into account as referred to in (1), if it has made the election by written notice to the FSA in a way that complies with the requirements for written notice in SUP 15.7
(3) A firm that has made an election referred to in (2) must value that regulated related undertaking in accordance with (4) for the purpose of the calculation of the group capital resources and group capital resources requirement of an undertaking referred to in PRU 8.3.17 R.
(4) Subject to (5), a regulated related undertaking within (3) must, for the purposes of the calculations referred to in (1), be valued in accordance with PRU 1.3.11 R.
(5) For the purposes of valuing a regulated related undertaking within (3), the value of that regulated related undertaking determined in accordance with PRU 1.3.11 R, must be reduced:
(a) by an approximate amount, to the extent that the value of the regulated related undertaking cannot effectively be realised to meet the group capital resources requirement of an undertaking in PRU 8.3.17 R; and
(b) by an approximate amount, to the extent needed to exclude value attributable to goodwill generated from the business of the regulated related undertaking with other members of the insurance group.

From 31 December 2004 until the first day of the firm's financial year beginning in 2005

31 December 2004

As PRU TR 25R

(1) The inclusion of a regulated related undertaking which is not an insurance undertaking or an insurance holding company in the scope of application of PRU 8.3.33 R and PRU 8.3.36 R and implements the amendments to the First Non-Life Directive, the First Life Directive and the Insurance Groups Directive in Articles 22(2), 23(2) and 28(6) of the Financial Groups Directive.
(2) PRU TR 25R allows the requirement to include a regulated related undertaking which is not an insurance undertaking or an insurance holding company in the calculations required by Transitional Provisions to be postponed until the effective date of the Financial Groups Directive.
(3) In the interim, a firm may apply PRU 8.3, or elect to use the general valuation rules for related undertakings which do not fall within the scope of PRU 8.3, as set out in PRU 1.3.11 R, subject to the adjustments required by PRU TR 25R(5). The intention is to allow firms to continue to take the regulated related undertakings referred to in PRU TR 25R(1) and any other related undertaking not referred to in PRU 8.3 into account as they would formerly have done for the purposes of calculating the group capital resources of an undertaking in PRU 8.3.17 R.

As PRU TR 25R

14/01/2005

PRU Sch 1

Record keeping requirements

31/12/2004

PRU Sch 1.1

1 The aim of the guidance in the following table is to give the reader a quick overall view of the relevant record keeping requirements.
2 It is not a complete statement of those requirements and should not be relied on as if it were.
3 Table

31/12/2004

Handbook reference

Subject of Record

Contents of record

When record must be made

Retention period

PRU 1.2.37 R, PRU 1.2.38 R

Firm's assessment of the adequacy of its financial resources

(1) The major sources of risk identified in accordance with PRU 1.2.31 R
(2) How the firm intends to deal with those risks
(3) Details of the stress tests and scenario analyses carried out and the resulting financial resources estimated to be required in accordance with PRU 1.2.35 R

Not specified

At least 3 years

PRU 1.4.53 R

Prudential risk management and systems and controls

Accounting and other records that are sufficient to enable the firm to demonstrate to the FSA:
(1) that the firm is financially sound and has appropriate systems and controls;
(2) the firm's financial position and exposure to risk (to a reasonable degree of accuracy);
(3) the firm's compliance with the rules in PRU

Not specified

3 years, or longer as appropriate

PRU 7.3.20 R

Mathematical reserves

(1) The methods and assumptions used in establishing the firm's mathematical reserves, including the margins for adverse deviation, and the reasons for their use
(2) The nature of, reasons for, and effect of, any change in approach, including the amount by which the change in approach increases or decreases its mathematical reserves

Not specified

An appropriate period

PRU 7.4.17 R, PRU 7.4.19 R

Calculation of with-profits insurance capital component

(1) The methods and assumptions used in making any calculation required for the purposes of PRU 7.4 (and any subsequent changes) and the reasons for their use
(2) Any change in practice (in particular changes in those items which will or may be significant in relation to the eventual claim values) and the nature of, reasons for, and effect of, any change in approach with respect to those methods and assumptions

Not specified

An appropriate period

PRU 7.6.23 R

Long-term insurance funds

A separate accounting record in respect of each of a firm's long-term insurance funds

Not specified

PRU 7.6.56 R, PRU 7.6.57 R

Branch accounting records in the United Kingdom

A record of the activities carried on from a non-EEA direct insurer's United Kingdom branch and, if it is an EEA-deposit insurer, from its branches in other EEA states including a record of:
(1) the income, expenditure and liabilities arising from activities of the branch or branches
(2) the assets identified under PRU 7.2.20 R as available to meet those liabilities

Not specified

31/12/2004

PRU Sch 2

Notification requirements

01/12/2004

PRU Sch 2.1

There are no notification requirements in PRU 1 or PRU 8. This Schedule does not cover any other chapter of PRU.1 The aim of the guidance in the following table is to give the reader a quick overall view of the relevant notification requirements.

11/08/2004

2 It is not a complete statement of those requirements and should not be relied on as if it were.

11/08/2004

3 Table

11/08/2004

Handbook reference

Matter to be notified

Contents of notification

Trigger event

Time allowed

PRU 2.1.38 R

Breach or expected breach of PRU 2.1.9 R

Fact of breach or expectation of breach

Breach or expectation of breach

Immediately

PRU 2.2.71 R

Intention to include any perpetual non-cumulative preference shares or innovative tier one instruments in the firm's tier one capital resources for the purposes of PRU 2.2

Fact of intention

Intention to include

At least one month before the firm first includes the relevant items in its tier one capital resources

PRU 2.2.72 R

Intention to redeem a tier one capital instrument that a firm has included in its tier one capital resources for the purpose of PRU 2.2

Fact of intention

Intention to redeem

At least one month before the intended redemption

PRU 2.2.116 R

Proposed amendment to the terms of the debt and the documents referred to in PRU 2.2.108R (8)

Details of the proposed amendment and confirmation that the legal opinions referred to in PRU 2.2.108R (11) and, if applicable, PRU 2.2.105 R and PRU 2.2.111 R, continue in full force and effect in relation to the terms of the debt and the documents notwithstanding any proposed amendment

Proposal to amend

At least one month before the amendment is due to take effect

PRU 2.2.117 R

Intention to repay a tier two instrument (unless the firm intends to repay an instrument on its contractual repayment date)

Fact of intention and details of how the firm will meet its capital resources requirement after such a repayment

Intention to repay

At least six months before the proposed date of repayment

PRU 3.2.23 R

That a reinsurance exposure to a reinsurer or group of closely related reinsurers is reasonably likely to exceed, or has exceeded, 100% of the firm's capital resources excluding capital resources held to cover property-linked liabilities

Fact that the limit is reasonably likely to be, or has been, exceeded
Note: upon notification under PRU 3.2.23 R the firm must:
(1) demonstrate that prudent provision has been made for the reinsurance exposure in excess of the 100% limit, or explain why in the opinion if the firm no provision is required, and
(2) explain how the reinsurance exposure if being safely managed (see PRU 3.2.24 R

(1) A reasonable likelihood that the limit will be exceeded, or
(2) if (1) does not apply , the limit being exceeded

As soon as the firm first becomes aware of the matter required to be notified

PRU 3.2.29 R

That the firm has exceeded, or anticipates exceeding, the limit expressed in PRU 3.2.28 E (in each financial year a firm should restrict the gross earned premiums which it pays to a reinsurer or group of closely related reinsurers to the higher of (a) 20% of the firm's projected gross earned premiums for that financial year and (b) ?4 million)

Fact that the limit has been exceeded, or that the firm anticipates exceeding the limit
Note: upon notification under PRU 3.2.29 R the firm must explain to the FSA how, despite the excess reinsurance concentration, the credit risk is being safely managed (see PRU 3.2.30 R)

The limit being exceeded, or an anticipation that the limit will be exceeded

Immediately

11/08/2004

PRU Sch 3

Fees and other required payments

31/12/2004

Notification Requirements

PRU PRI Sch 3.1

There are no requirements for fees or other payments in PRU 1 or PRU 8. This Schedule does not cover any other chapter of PRU.There are no requirements for fees or other payments in PRU.

31/12/2004

PRU Sch 4

Powers exercised

31/12/2004

Powers Exercised

PRU Sch 4.1

The following powers and related provisions in the Act have been exercised by the FSA to make the rules in PRU:

(1)

section 138 (General rule-making power);

(2)

section 141 (Insurance business rules);

(3)

section 149 (Evidential provisions);

(4)

section 150(2) (Actions for damages); and

(5)

section 156 (General supplementary powers).

31/12/2004

PRU Sch 4.2

The following power in the Act has been exercised by the FSA to give the guidance in PRU :

Section 157(1) (Guidance).

31/12/2004

PRU Sch 5

Rights of action for damages

01/12/2004

Rights of action for damages

PRU Sch 5.1

The table below sets out the rules in PRU contravention of which by an authorised person may be actionable under section 150 of the Act (Actions for damages) by a person who suffers loss as a result of the contravention.

11/08/2004

PRU Sch 5.2

If a "Yes" appears in the column headed "For private person", the rule may be actionable by a private person under section 150 (or, in certain circumstances, his fiduciary or representative; see article 6(2) and (3)(c) of the Financial Services and Markets Act 2000 (Rights of Action) Regulations 2001 (SI 2001/2256)). A "Yes" in the column headed "Removed" indicates that the FSA has removed the right of action under section 150(2) of the Act. If so, a reference to the rule in which it is removed is also given.

11/08/2004

PRU Sch 5.3

The column headed "For other person" indicates whether the rule may be actionable by a person other than a private person (or his fiduciary or representative) under article 6(2) and (3) of those Regulations. If so, an indication of the type of person by whom the rule may be actionable is given.

11/08/2004

PRU Sch 5.4

Chapter/Appendix

Section/Annex

Rights of action under section 150

For private person

Removed

For other person

All rules in PRU

Yes (PRU 1.8.1 R)

11/08/2004

PRU Sch 6

Rules that can be waived

31/12/2004

Rules that can be waived

PRU Sch 6.1

The rules in PRU can be waived by the FSA under section 148 of the Act (Modification or waiver of rules), except for PRU 1.8.1 R (actions for damages).

31/12/2004