Some Notes on the Fusion of Life Assurance Funds

Abstract

The merger, a few years ago, of two large composite insurance company Groups brought together under one ultimate control three substantial life assurance funds each fully operative and transacting all types of ordinary life assurance and annuity business. Those three funds have now been fused together by the legal transfer of the life businesses of two of the companies in the Group to the parent company and, as this fusion seems to be the first of its kind which has been undertaken for many years, and certainly the first of such size in the life assurance history of Great Britain, it has been suggested that the operation is of sufficient interest to actuaries generally as to warrant the submission of a paper to a sessional meeting. We are, however, conscious of the fact that, whilst the operation may have added to our history as a practical application of the law and some of our principles, it has not added either to previous knowledge or to our technique. The law governing the operation has remained virtually unchanged since the comprehensive review of life company amalgamations by the late K. J. Britt in the paper he submitted to the Institute in April 1931 (J.I.A. 62, 276) and probably the whole of the technical aspects involved have been expounded by Redington in the masterful review of the principles of life office valuations which he submitted in April 1952 (J.I.A. 78, 286).