BREXIT And Insurance ^Featured

UK regulators have demanded that every UK insurer now doing business in the EU/EFTA - whether by passport or local subsidiary- and every EU/EFTA insurer doing business in the UK on a passport or full basis -must show them their contingency plan that covers all options including the nuclear one of a UK exit with no deals. 

Much will depend on what is negotiated -but do not believe the hype from either side. The core rule from the EU is very simple- non-members are not allowed to have deals equal to those that members have, and despite what British politicians may shout- that is non-negotiable. 

One of the anticipated losses resulting from the UK's exit in 2019 is its exclusion from the single market, namely its exclusion from the free movement of goods, services and workers within the EU. This will impact insurance businesses in the UK that will lose their right of direct access to the single market, and EU insurers will lose their right of direct access to the UK.

40% of UK insurance businesses are studying alternative scenarios involving migrating their European business to other member states.

There will be two parallel but not identical sets of laws- in the UK and in the EU/EFTA countries. Any UK insurer or broker doing business in the new EU/EFTA block will be subject to ALL the laws and rules in that region such as on solvency, insurance regulation and competition- plus the UK rules on solvency, insurance regulation and all other regulation that will diverge from EU rules.

In the UK the Bank of England and subsidiary insurance/financial regulators have confirmed that there will be no bonfire of regulations post-Brexit - while other regulators and bodes such as on competition and health and safety have made similar promises. 

Insurance author Ian Youngman comments; " Wait and see is not an option given the time that it will take to set up a regulated subsidiary within an EU member state or in the UK. If you rely in the main UK media for your Brexit information you could be in for a few surprises. My report is non-political and takes information from across Europe-including primary sources. It is written in a non-technical way so that every insurer and broker can easily understand what is happening and why they must get ready for all possibilities- now, not 2018 or 2019."