American insurers in the UK still largely inattentive to Brexit
Recent research by ICODA European Affairs on the reaction of UK-based US insurance and reinsurance undertakings to the Brexit announcement revealed that nearly 50% is still in a wait and see mode, despite e.g. the potential impact on passporting and branching arrangements. Several US insurers and reinsurers use the UK as their EU hub. They provide cover to clients on the continent, especially in commercial lines and specialty risks. Only those US insurers and reinsurers which passport out of the UK into the EU27 were considered in the research.
Based on this sample, it looks like preparation is uneven. Although the UK-based US insurers and reinsurers with cross-border activities between the UK and EU27 represent a small number of all UK (re-)insurance undertakings that could be affected by Brexit, the results of the research reveal that the insurance industry needs to start paying attention to all Brexit risks before they end up getting a bad hit from an unanticipated hard Brexit. The FCA requested all insurers and other financial sector firms to undertake appropriate contingency planning for all possible scenarios. This includes also a scenario containting no Brexit at all. Given the research results, the FCA’s explicit request is timely and needed.
For more information on the study or on EU insurance regulations, Solvency II, Brexit, equivalence or passporting, contact email@example.com