Guernsey’s position as the go-to jurisdiction for longevity risk transactions was outlined at a Guernsey Finance event in London.
John Coles, head of operations for the BT Pension Scheme, addressed the audience on how BT structured its £16 billion longevity risk transfer and why a Guernsey based structure was used.
Coles said: “It was important for the trustees that they felt comfortable with the jurisdiction and Guernsey certainly meets that. It has a good legal framework and a good regulatory environment.”
He added that Guernsey’s utilisation of the incorporated cell company structure was also the most appropriate and practical way of meeting the needs of the transaction.
“The regulator and all of the companies in Guernsey recognise the business activity. They understand the risks and that is very helpful. Guernsey is open for quality business,” said Coles.
“From our particular experience we have met and now use a number of very experienced and talented people with both insurance and captive knowledge and they have been very adaptable and flexible in helping us to land what was quite an innovative transaction for the scheme—to actually create its own captive, certainly in a transaction of this size.”
In addition, a panel discussion examined captive insurance solutions, longevity trends, needs and future opportunitiesm, and how Guernsey has been able to position itself so effectively in this area through the use of cell company structures, regulation and reinsurance capacity.
Moderated by captive insurance veteran Malcolm Cutts-Watson, the panel consisted of Ian Aley of Towers Watson; John Dunford of the Guernsey Financial Services Commission; Philip Jarvis of Allen & Overy LLP; Paul Kitson of PwC and Andy McAleese of Pacific Life RE.
