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HMRC internal manual

Employment Related Securities Manual

Employment-related securities and options: insurance contracts

Rights under contracts of insurance other than excluded contracts of insurance are included in the definition of securities from 2 December 2004 (see ITEPA03/S420 (1)(aa), (1A) and (1B)).

“Contract of insurance”, “contract of long-term insurance”, and “contract of general insurance” have the same meaning as in the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001.

An excluded contract of insurance is a contract:

  1. for an annuity which is (or will be) pension income,
  2. of long-term insurance, other than an annuity contract, which does not have a surrender value and is not capable of acquiring one (whether on conversion or in any other circumstances), or
  3. of general insurance other than one which falls, in accordance with generally accepted accounting practice, to be accounted for as a financial asset or liability.