Munich Re America (MRA) will apply to the Federal Court to transfer its direct insurance contracts written by the Australian branch of the company to Great Lakes Re (UK) in Sydney.

A hearing in the Federal Court in Sydney on November 30 will hear the application to approve the changeover, with a provisional date of December 1 for the transfer to take effect.

The reinsurer is also applying to the courts to approve the transfer of its Australian reinsurance business from MRA to the local branch of the German parent, Munich Re.

As part of the general insurance transfer, MRA is paying Great Lakes $26.9 million to cover claims that are under way between December 31 last year and when the transfer officially takes place.

After this transfer Great Lakes will indemnify MRA for all future claims, losses and costs arising from the transfer of the businesses.

Great Lakes will also receive all premiums and settlement amounts that would have been paid to MRA after the settlement date.

An actuarial report by Kaise Stephen submitted to the court says Great Lakes will have a projected capital coverage of between 165% to 230% of the Australian Prudential Regulation Authority’s minimum capital requirements.

The actuary also notes there will be no changes to the terms and conditions of insurance contracts as a result of this ownership change.