Legal briefing

The transfer of insurance renewal rights


In this Legal Briefing, we analyse the main practical issues raised by the lack of regulation surrounding the transfer of renewal rights, as well as the suitability of a stance by the national regulator that establishes clear rules and guarantees for this issue.

The question of whether or not it is possible under Spanish law for an insurer (“Insurer A”) to transfer the renewal rights to another insurer (“Insurer B”) is a recurring issue.

This type of transfer is neither expressly provided for nor prohibited by the insurance sector’s organisation, supervision and solvency regulations, which only provide for the portfolio transfer, in the same manner as the European regulations under Solvency II and reflecting centuries-old customs in the sector’s tradition concerning the sharing and transferring of risks. In other words, it is expressly permitted to transfer portfolios between insurers, but the regulations are silent on the possibility of providing an insurer who is not a party to a current contractual relationship with data and elements that make it a valid intermediary of the policyholder in the subsequent window of renewal of the contract.

However, this possibility is not expressly prohibited under Spanish law and is recognised under comparative law: for example, in the Anglo-Saxon and US markets, it is included in so-called policy replacement transactions and, to the extent that it is relevant to Spanish law, renewal rights agreements.

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