On 22 July 2026, the Prudential Regulation Authority (PRA) published Consultation Paper 12/26 – Insurance friendly societies, amalgamations and transfers (CP12/26), setting out proposed updates to Chapter 4 of Statement of Policy 3/15 (SoP3/15), which governs the PRA’s approach to amalgamations and transfers of engagements by friendly societies (FSocs) under Part VIII of the Friendly Societies Act 1992 (FSocs Act).
The proposals stem from a commitment made in the PRA/Financial Conduct Authority Mutuals Landscape Report to provide clearer guidance on Part VIII transactions in support of the long-term, sustainable growth of financial mutuals. They are aimed at providing clarity and guidance within the existing statutory framework to be applied flexibly where safeguards allow.
The consultation closes on 22 October 2026, and the revised SoP3/15 will take effect on publication of the final Policy Statement which is expected to be before April 2027.
The proposals
In summary, the key proposals are:
- Setting out a clear set of steps for firms to follow when undertaking a transfer or amalgamation under Part VIII whilst preserving flexibility for firms to depart from these where appropriate, underpinned by a clearer explanation of the key elements of the legislative process.
- Codifying the PRA’s approach to Part VIII through the provision of detail across the five steps in the process, including early engagement and its assessment of whether the proposed transfer is in the interests of members, and further detail on post confirmation steps.
- Clarity on the factors the PRA will consider when deciding whether to exercise its statutory discretion in relation to special resolution dispensations and the appointment of an independent actuary and on the evidential expectations at each stage.
- Guidance on the content requirements for the documentation required in the Part VIII process.
- Proposed minimum timescales for representations and hearings as well as Confirmation Assessment Meetings and greater flexibility on how firms prepare for Representation Hearings.
- An extension of Part VIII transfer expectations so that both FSoc and non-FSoc firms follow a similar process including verifying compliance with their respective rules or governance framework, thereby ensuring that the PRA’s assessment of Part VIII transfers remains consistent regardless of the transferee’s legal form.
- Clarification that the initiation of the Part VIII process does not suspend ongoing prudential obligations including those on solvent exit analysis and, where applicable, solvent exit execution plans.
The PRA intends to hold a roundtable discussion on the proposals. Those wishing to participate in the roundtable should contact the PRA by 20 August 2026 at: CP12_26@bankofengland.co.uk.