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Scottish Holdings Chapter 11 Bankruptcy

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Scottish Holdings and affiliated Debtor Scottish Annuity & Life Insurance Company (Cayman) filed for Chapter 11 protection with the U.S. Bankruptcy Court in the District of Delaware, lead case number 18-10160.

The Company, which engages in the reinsurance of life insurance, annuities and annuity-type products, is represented by Eric D. Schwartz of Morris, Nichols, Arsht & Tunnell. Documents filed with the Court note, “…Scottish Holdings, Inc. (‘SHI’) and Scottish Annuity & Life Insurance Company (Cayman) Ltd. (‘SALIC,’ and together with SHI, the ‘Debtors’) and certain of their non-debtor affiliates (the Debtors with their non-debtor affiliates are collectively referred to as ‘Scottish Re’) since May 2015.” The ultimate parent of the Scottish Re companies is Scottish Re Group Limited (SRGL). SRGL is not a Debtor in the U.S. Bankruptcy Court proceedings; however, the parent has commenced voluntary winding-up proceedings in the Cayman Islands and Bermuda.

Scottish Holdings explains, “In recent years Scottish Re has suffered negative financial results led primarily by adverse mortality experience on the yearly renewable term (‘YRT’) segment of its business. On a consolidated US GAAP basis, Scottish Re incurred a net loss of $202.8 million for the year ended December 31, 2016, and a net loss of $260.8 million for the year ended December 31, 2015. Though Scottish Re has taken steps to improve its financial results, including by increasing the premiums it charges for YRT reinsurance, these steps have not resulted in improvement significant enough to avoid the need to restructure Scottish Re.”

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