Aviva is to simplify its UK general insurance business to enable it to meet the new Solvency II proposals.

The move will see Aviva Insurance UK, Aviva International Insurance, CGU Underwriting, Hamilton Insurance, London and Edinburgh Insurance and Ocean Marine Insurance’s general and health polices transferred to a new single company called Aviva Insurance.

The Scottish general insurance business of CGU Bonus and the Scottish Boiler and General Insurance Company will be transferred to the new company.

The Jersey-based business of the English and Scottish insurers will be transferred to Aviva Insurance.

According to a letter sent to policyholders, the move will take effect on November 14, subject to regulatory and court approvals.

“These changes will help us to simplify our legal and governance structure and help us to comply with new European rules on insurance regulation due to come into force in 2013,” Aviva UK General Insurance CEO David McMillan said.

The complexity of the proposal will result in some Canadian policyholders remaining with Aviva International Insurance, but the insurer has said it will meet any future claims.

Ocean Marine, a dedicated run-off entity, will now handle all of Aviva’s London market business. Aviva Insurance, Aviva International, London and Edinburgh as well as The World Auxiliary Insurance Corporation business will be transferred to Ocean Marine and reinsured by Aviva.

The Jersey-based London markets business of these insurers is also being moved to Ocean Marine.

Aviva will also maintain Ocean Marine’s solvency capital and provide an additional £1 billion ($1.6 billion) adverse development protection. Claims for Ocean Marine’s London market business will continue to be covered by US insurer National Indemnity Company.

All reinsurance contracts on the general insurance business with the various Aviva insurers will be maintained.