# The Insurers (Winding Up) Rules 2001, Paragraph 3


(1) This paragraph applies where—
(a) paragraph 2(2)(a) applies and the company has a right under the terms of the policy either to make periodic withdrawals from the fund referred to in that paragraph or to retain any part of the income accruing in respect of the assets of that fund,
(b) paragraph 2(2)(b) applies and the company has a right under the terms of the policy to receive the whole or any part of any distributions made in respect of the units referred to in that paragraph, or
(c) paragraph 2(2)(a) or paragraph 2(2)(b) applies and the company has a right under the terms of the policy to make periodic cancellations of a proportion of the number of units credited to the policy.
(2) Where this paragraph applies, the value of the linked liabilities calculated in accordance with paragraph 2(1) shall be reduced by an amount calculated in accordance with sub-paragraph (3) of this paragraph.
(3) The said amount is—
(a) where this paragraph applies by virtue of head (a) or (b) of sub-paragraph (1), the value as at the liquidation date, calculated on actuarial principles, of the future income of the company in respect of the units in question arising from the rights referred to in head (a) or (b) of sub-paragraph (1) as the case may be, or
(b) where this paragraph applies by virtue of head (c) of sub-paragraph (1), the value as at the liquidation date, calculated on actuarial principles, of the liabilities of the company in respect of the units which fall to be cancelled in the future under the right referred to in head (c) of sub-paragraph (1).
(4) In calculating any amount in accordance with sub-paragraph (3) there shall be disregarded—
(a) such part of the rights referred to in the relevant head of sub-paragraph (1) which in the opinion of the liquidator constitutes appropriate provision for future expenses and mortality risks, and
(b) such part of those rights (if any) which the court considers to constitute appropriate provision for any right or expectation of the policy holder to receive benefits additional to the benefits guaranteed under the terms of the policy.
(5) In determining the said amount—
(a) interest shall be assumed at such rate or rates as the court may direct, and
(b) where relevant, the rates of mortality and the rates of disability to be employed shall be such rates as the court considers appropriate after taking into account:
(i) relevant published tables of rates of mortality and rates of disability, and
(ii) the rates of mortality and the rates of disability experienced in connection with similar policies issued by the company.

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Source: https://www.legislation.gov.uk/uksi/2001/3635/schedule/3/paragraph/3 (the official version)
Page: https://openlegislation.uk/insurers-winding-up-rules-2001/schedule-3/paragraph-3
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.