Carrier and custody arrangements: who holds the assets, who manages them, who answers for what

Carrier and custody arrangements are the contracts that decide who legally owns a PPLI policy's assets (the carrier), who physically holds them (the custodian bank), who decides what to buy and sell (the investment manager) and what the policyholder actually owns (a contractual claim against the carrier). Most misunderstandings about PPLI — on protection, control and fees — come from blurring these roles. This page maps each party to the document that binds it and lists the checks a family and its advisers can make before choosing a carrier.

Role map: who does what, under which document

A seventh participant — the regulator of each party — sits behind the table: the carrier's insurance supervisor, the custodian's banking supervisor and the manager's securities regulator are often in three different countries.

Legal versus economic ownership

The carrier is the legal owner of the assets in the policy's account. The policyholder's economic interest is expressed through the policy value, which tracks those assets less charges. Three consequences follow.

1. The holder cannot instruct the custodian. Instructions run from carrier to custodian and from carrier to manager. Direct holder instructions would undermine both the insurance characterisation and, for some residents, the tax treatment (see investment flexibility).
2. Protection attaches to the carrier relationship. Statutes such as Luxembourg's policyholder priority or Bermuda's segregated-account ring-fencing protect claims on the carrier; see asset protection.
3. Unit-linked value is not guaranteed. In Luxembourg the carrier guarantees a number of units, not their value (ACA; see Luxembourg).

Custody models by jurisdiction

Where this site has not verified a jurisdiction-specific rule, the table names the question rather than the answer.

Appointing and replacing the investment manager

In a dedicated-fund policy, the policyholder may propose a manager — often the family's existing private bank or asset manager — but the carrier decides whether to appoint it, signs the investment management agreement and sets the limits. Typical elements:

• Approval. The carrier checks the manager's licence, track record documentation and operational controls.
• Mandate. Objective, risk profile, permitted assets and concentration limits, written to satisfy the booking jurisdiction's investment rules and, where relevant, US diversification rules.
• Reporting. Valuations and holdings go to the carrier and administrator; the policyholder receives policy statements.
• Replacement. The carrier can terminate and replace the manager, sometimes at the holder's request; the custody account can stay in place.
• Fees. Manager, custody and carrier charges are separate layers; refer to the policy contract, custody agreement and carrier documents for actual rates.

Assessing a carrier: due-diligence dimensions

Due diligence on a carrier is about evidence, not reputation.

Sector figures describe a market, not any individual carrier, and none of the above is a ranking.

When carriers change hands

PPLI carriers are periodically sold, merged or restructured, and new ones are licensed. The following are named only as examples of ownership change; they are not an assessment or recommendation of any carrier. According to WealthBriefing (2025-11-06), Utmost Group, which acquired Lombard International in December 2024, completed the integration and renamed the business Utmost Luxembourg, reporting combined assets under administration of £107.1 billion (US$139.5 billion) and about 200,000 clients as of 30 June 2025. In Bermuda, the BMA's September 2026 registration statistics (published 2026-10-19) record Sun Life Bermuda Limited registering as a Class C insurer on 2026-09-24, among 42 new insurer registrations of all classes in 2026 to date.

For an existing policyholder, a change of ownership can bring a portfolio transfer, new service terms or a change of custodian. Ask whether the policy, custody agreement and investment mandate transfer unchanged, whether the regulator must approve the transfer and whether any reporting relationships change.

Twelve questions before choosing a carrier

1. Who regulates the carrier, and under what licence?
2. What solvency information is published, and how recent is it?
3. Which statute segregates policy assets, and does it cover this product?
4. Which custodian holds the assets, and under which law?
5. Does a regulator approve or review the custody agreement?
6. Who may propose, appoint and replace the investment manager?
7. What does the mandate permit and prohibit?
8. Can premiums be paid in kind, and can benefits be paid in kind?
9. Which charges are taken by carrier, manager and custodian?
10. How does the carrier handle CRS, FATCA and home-country reporting?
11. What happens on a sale, merger or portfolio transfer?
12. What happens to the policy if the holder changes tax residence?

The process of answering these questions step by step is set out in how a PPLI policy is put in place. Tax, reporting and legal outcomes depend on the residence of the policyholder, insured and beneficiaries; obtain advice in each relevant jurisdiction, including Singapore, Hong Kong and mainland China where applicable. If you need help applying this to your situation, you can register an enquiry through the contact options on this site.