Herbert Smith has worked with Co-operative Financial Services’ (CFS) in-house legal function to bring about a complete restructuring of the mutual’s insurance business.
Peter Kerns, head of legal for CFS, collaborated with Herbert Smith’s head of financial institutions David Willis in the work to split the general and life businesses of CFS subsidiary the Co-operative Insurance Society (CIS).
The restructure is designed to bring the CIS into line with European directives, which require insurers to split the selling of life and non-life insurance. The Co-op is one of the few remaining insurers to undertake the split.
The new structure was due to take effect yesterday (15 January) following approval by the CFS board. CIS General Insurance will sell motor, home and commercial insurance, while CIS will continue to offer life, savings and investment policies. In total, CIS has five million customers and around £16bn worth of assets.
Kerns said a team of four lawyers, led by Chris Parsons, head of insurance, contracts and commercial for the CFS legal function, handled most of the in-house work, including drafting the new asset transfer and services agreements. Herbert Smith looked after other aspects, such as indemnity, reinsurance and loan agreements.
“Herbert Smith have wider expertise in that sort of corporate structuring,” Kerns explained. “They’re lawyers that work with the business. Because we’ve got such a long relationship with them, they know the ins and outs of our business.”
He added: “The relationship worked very well; there is almost continual liaison to make sure the transaction progresses.”
Both the CFS and CIS are longstanding Herbert Smith clients across a variety of practice areas.