IRB Brasil Closes 43-Year UK Run-Off via Part VII Transfer to Carrick Group
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IRB Brasil Closes 43-Year UK Run-Off via Part VII Transfer to Carrick Group

IRB Brasil closes UK run-off with a Part VII transfer sanctioned 16 June 2026, ending a London casualty book in run-off since 1983 — a signal that legacy finality is now routine capital management.

Patrice Dumont June 24, 2026 7 min read

IRB Brasil closes UK run-off with a High Court-sanctioned Part VII transfer, ending a London-market reinsurance book that has been in run-off since 1983 — a quiet transaction that signals how legacy finality tools are now standard capital management for profitable, growing reinsurers beyond the traditional run-off acquirer universe.

Forty-Three Years in Run-Off, Closed in a Single Court Order

The High Court sanctioned the Part VII transfer of IRB-Brasil Resseguros SA’s UK branch business to Community Reinsurance Corporation Limited (CRCL) on 16 June 2026, with the transfer becoming effective on 20 June 2026. The portfolio being transferred is not a recent casualty: IRB’s UK branch underwrote casualty reinsurance in the London market from 1974 to 1983 and has been in run-off for over 43 years.

The scheme was preceded by a loss portfolio transfer (LPT) executed in January 2024, in which Carrick Re Limited, a Bermuda class 3A reinsurer, entered into an LPT with IRB(Re) on behalf of its UK branch ahead of the Part VII transfer. At that stage, Carrick UK Services Limited assumed the UK branch’s staff and operations as part of the transaction. The January 2024 LPT thus served as the economic de-risking step; the June 2026 Part VII completed the legal novation, moving all contracts, assets and liabilities to CRCL. According to Community Reinsurance Corporation’s official transfer notice, there will be no change to the arrangements for policy and claims administration — a standard policyholder protection condition in UK Part VII schemes.

IRB’s legal notice, published through its investor relations portal, confirmed that all the contracts, property, assets and liabilities relating to the transferring business would pass to CRCL, closing the loop on a liability tail that has outlasted multiple economic cycles, the collapse of Lloyd’s in the early 1990s, and the introduction of Solvency II.

Carrick Group: Aggregating Legacy Liabilities as a Business Model

The transferee, Community Reinsurance Corporation Limited (CRCL), is a subsidiary of the Carrick Group, described as an international non-life legacy business providing reinsurance and run-off management solutions. Carrick’s pedigree is worth noting. The group was founded in 2019 by Karl Wall, a run-off industry veteran with over 30 years of experience including eight years as President and CEO of Enstar (US) Inc., and its management team had collectively completed more than 50 run-off transactions involving liabilities exceeding $10 billion. Carrick Specialty Holdings subsequently acquired Community Reinsurance Corporation Limited from Hampden PLC in December 2020, following an initial $100 million capital injection from Sequentis Financial LLC.

Phil Hernon, COO of Carrick Group, articulated the strategic rationale at the time of the 2024 LPT announcement: “This type of transaction fits perfectly within Carrick’s strategy to aggregate legacy insurance liabilities and grow our team of skilled professionals.” The Carrick Holdings press release on the IRB(Re) LPT framed the transaction as a building block in a deliberate aggregation play, not a one-off opportunistic acquisition. That aggregation model — buying or accepting transfers of tail liabilities, centralising claims management expertise, and extracting value through reserving discipline and investment yield — mirrors what larger platforms such as Enstar have pursued at scale. For context on how that run-off wave is developing globally, see InsuraBeat’s coverage of Enstar CEO Dan Sanford’s outlook as the run-off wave builds in 2026.

The independent expert for the Part VII scheme was Simon Sheaf of Grant Thornton UK Advisory & Tax LLP, who prepared reports supporting the transfer including supplementary updates addressing withdrawn objections. The absence of sustained objections — and the clean court sanction — reflects both the maturity of the UK Part VII process and the relatively contained nature of a 43-year-old casualty book where the universe of active claimants is, by now, sharply defined.

IRB’s Domestic Pivot: Capital Freed for Brazil’s Growing Market

For IRB, the Part VII closure is not a distress signal — it is a capital hygiene measure by a reinsurer in robust financial health. IRB(Re) reported a net income of R$372.7 million for full year 2024, a 226.2% increase versus R$114.2 million in 2023, while premiums written reached R$6.6 billion, a 1.5% increase. The turnaround from the scandal-hit years of the early 2020s is well advanced, and management’s strategic direction is explicit: Brazil accounted for 71% of IRB(Re)’s retained premiums in 2024 (R$2.9 billion), up from 69.2% in 2023, reflecting a continuing refocus on domestic and regional business.

Maintaining regulatory capital and management bandwidth for a dormant UK branch — however small — creates friction. Removing it cleanly via Part VII frees IRB to allocate both toward its domestic and LATAM expansion. That domestic focus is timely: Brazil’s new Insurance Law 15.040 is reshaping the regulatory landscape for carriers and brokers in 2026, with significant implications for how reinsurers deploy capital and structure products in the market. IRB, as Brazil’s dominant domestic reinsurer, sits at the centre of that shift. A cleaner balance sheet — free of legacy offshore run-off noise — strengthens its position as the law’s new framework beds in.

The domestic pivot also intersects with Brazil’s nascent risk-transfer innovation. Galapagos Capital’s benchmark ILS/LRS transaction has set a benchmark for Brazil’s emerging insurance-linked securities market — another channel through which IRB could deploy freed capital or participate as a cedant as its balance sheet continues to strengthen.

2026 as a Turning Point for UK Non-Life Part VII Activity

The IRB transaction is one data point in a broader acceleration. According to Milliman’s May 2026 briefing on non-life Part VII transfers, 2026 is shaping up to be a bumper year for non-life Part VII sanctions, with four already sanctioned in early 2026 from five that had directions hearings in 2025, and the IRB-to-Community Re transfer is listed among them. That pace is striking given historical norms: since Part VII transfers were introduced under the Financial Services and Markets Act 2000, over 200 transfers of non-life portfolios have been court-sanctioned in the UK, yet only two were sanctioned in each of 2023, 2024, and 2025. Four in the first half of 2026 alone suggests the pipeline built during the post-COVID capital-review cycle is now clearing.

The structural drivers are well understood: reserving uncertainty on long-tail casualty books is reducing as older accident years close out; rising interest rates have improved the economics of running off liabilities against fixed-income assets; and acquirers like Carrick, Enstar, RiverStone and others have built credible regulatory track records that make Part VII courts more comfortable granting sanctions. The IRB case adds a dimension less commonly discussed: that profitable, strategically focused operating reinsurers — not just distressed or exiting groups — are now using Part VII as a routine tool to tidy legacy offshore exposure and reallocate capital to core markets.

For LATAM reinsurers and regional players with legacy London market exposure accumulated during the pre-2000 era of open-market international underwriting, the message is practical: the legal infrastructure exists, the specialist acquirers are well capitalised, and regulatory appetite for approving well-structured schemes is high. The question is not whether these tools are available, but whether management teams have the appetite to initiate the process.

Mini-FAQ

What is a Part VII transfer and why does it matter for run-off portfolios?
A Part VII transfer is a court-supervised mechanism under the UK Financial Services and Markets Act 2000 that allows insurance or reinsurance business to be legally novated from one entity to another, binding all policyholders without requiring individual consent. For run-off portfolios, it provides legal finality: once sanctioned, the transferring entity has no residual liability and can be wound down cleanly. Since the mechanism was introduced, over 200 non-life Part VII transfers have been court-sanctioned in the UK (source: Milliman, May 2026).
Why did IRB Brasil retain a UK branch in run-off for 43 years before completing this transfer?
Long-tail casualty reinsurance written in the London market in the 1970s and early 1980s — particularly US casualty — can take decades to fully develop, with asbestosis, environmental liability and other latent claims emerging long after policy expiry. Regulatory capital requirements, claims uncertainty, and the cost of structuring a transfer scheme mean that many cedants deferred action until the tail became sufficiently predictable. By the mid-2020s, the reserve profile of IRB’s UK book was evidently stable enough to support the LPT and subsequent Part VII. IRB’s strong domestic performance — net income of R$372.7 million in 2024 (source: IRB IR) — also gave it the financial position to absorb transaction costs without pressure.
What does this transaction signal for other LATAM reinsurers with legacy London market exposure?
Several Latin American reinsurers built London market books in the pre-internet era of international underwriting, accumulating long-tail casualty liabilities that have sat on balance sheets for decades. IRB’s completion of this transfer demonstrates that Part VII is accessible to non-UK groups — even those domiciled in markets with their own regulatory frameworks — provided the scheme is well-structured and an independent expert can satisfy the court on policyholder protection. With 2026 shaping up as a high-volume year for Part VII sanctions (Milliman, May 2026), the specialist acquirer community is active and the courts are familiar with the process. LATAM boards with legacy London exposure should be evaluating their options.

Sources used

Filed under

Topics M&A
Region LATAM
Line of business Reinsurance
Players Insurers
P

Patrice Dumont

InsuraBeat correspondent

Senior reporter at InsuraBeat leading coverage of insurance regulation, executive moves, and the insurtech landscape across EMEA and APAC. Fifteen years straddling regulation and trade journalism: began in the legal team of a French insurance industry body, advising members on Solvency II implementation and product approvals, then moved to specialised insurance media to cover EIOPA, NAIC and IAIS work and prudential reform. Graduate of the Pan-Asian School of Governance and Regulatory Affairs (Singapore), with an LL.M. in Insurance Prudential Law and Cross-Border Compliance from the Nihon-Siam Institute of Legal Studies (Bangkok). Writes from Brussels, on European afternoon markets.

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