This Prudential Regulation Authority (PRA) Policy Statement (PS) contains a rule change to increase protection for eligible policyholders of building guarantee policies (BGP). It makes amendments to the Policyholder Protection Part of the PRA Rulebook (Appendix).
This PS is relevant to:
- the Financial Services Compensation Scheme (FSCS) as the scheme administrator of the policyholder protection rules;
- UK insurers (including those that establish a branch or operate on a freedom of services basis in the European Economic Area (EEA), EEA insurers that establish a UK branch or operate in the United Kingdom on a freedom of services basis, and Channel Islands insurers and Isle of Man insurers with UK, Channel Island or Isle of Man risk or commitments);
- firms that have assumed responsibility for liabilities from PRA-authorised insurers (successors); and
The rule change takes effect on Thursday 8 October 2020.
The policy set out in this PS has been designed in the context of the UK’s withdrawal from the European Union and entry into the transition period, during which time the UK remains subject to European law. The PRA will keep the policy under review to assess whether any changes would be required due to changes in the UK regulatory framework at the end of the transition period, including those arising once any new arrangements with the European Union take effect.
The PRA has assessed that the policy would not need to be amended under the EU (Withdrawal) Act 2018 (EUWA). Please see PS5/19 ‘The Bank of England’s amendments to financial services legislation under the European Union (Withdrawal) Act 2018’ for further details.