Section 49E | Transitional serial interest: contracts of life insurance ^F1

(1)Where—^F1

(a)a person (“C”) is beneficially entitled to an interest in possession in settled property (“the present interest”), and^F1

(b)on C's becoming beneficially entitled to the present interest, the settled property consisted of, or included, rights under a contract of life insurance entered into before 22nd March 2006,^F1

the present interest so far as subsisting in rights under the contract, or in property comprised in the settlement that directly or indirectly represents rights under the contract, is a “transitional serial interest” for the purposes of this Chapter if the following conditions are met.

(2)Condition 1 is that—^F1

(a)the settlement commenced before 22nd March 2006, and^F1

(b)immediately before 22nd March 2006—^F1

(i)the property then comprised in the settlement consisted of, or included, rights under the contract, and^F1

(ii)those rights were property in which C, or some other person, was beneficially entitled to an interest in possession (“the earlier interest”).^F1

(3)Condition 2 is that—^F1

(a)the earlier interest came to an end at a time on or after 6th October 2008 (“the earlier-interest end-time”) on the death of the person beneficially entitled to it and C became beneficially entitled to the present interest—^F1F2

(i)at the earlier-interest end-time, or^F1

(ii)on the coming to an end, on the death of the person beneficially entitled to it, of an interest in possession to which that person became beneficially entitled at the earlier-interest end-time, or^F1

(iii)on the coming to an end of the second or last in an unbroken sequence of two or more consecutive interests in possession to the first of which a person became beneficially entitled at the earlier-interest end-time and each of which ended on the death of the person beneficially entitled to it, or^F1

(b)C became beneficially entitled to the present interest—^F1

(i)on the coming to an end, on the death of the person entitled to it, of an interest in possession that is a transitional serial interest under section 49C above, or^F1

(ii)on the coming to an end of the second or last in an unbroken sequence of two or more consecutive interests in possession the first of which was a transitional serial interest under section 49C above and each of which ended on the death of the person beneficially entitled to it.^F1

(4)Condition 3 is that rights under the contract were comprised in the settlement throughout the period beginning with 22nd March 2006 and ending with C's becoming beneficially entitled to the present interest.^F1

(5)Condition 4 is that—^F1

(a)section 71A below does not apply to the property in which the present interest subsists, and^F1

(b)the present interest is not a disabled person's interest.^F1