Andrew Agnew, Chair of London and International Insurance Brokers’ Association (LIIBA), asserted in a recent speech that ‘clients must come first in Brexit’.
Speaking during the European Federation of Insurance Intermediaries’ (BIPAR) annual conference in Madrid, Spain, Agnew said that he believed one of the most pressing issues was that of contract continuity. If the UK leaves the European Union (EU) with no transition or trading arrangements in place, servicing ongoing insurance contracts will fall under the governance of local conduct regulations in the remaining EU countries. This could lead to a potential breach of regulations to pay a claim in some countries.
“There is a very real risk that clients who bought policies in good faith may end up in limbo, uncertain as to whether those policies will be fulfilled,” said Agnew at BIPAR. “Insurers transferring liabilities to EU subsidiaries may not be the perfect answer because of the time and complexity involved. We believe this route could still leave clients unsure of their position.”
Agnew called for insurers in the UK and remaining EU countries to lobby the EU negotiating team and UK Government to make sure that that clients with existing contracts should be paid claims, and that the negotiating teams should ‘find a way of doing that, irrespective of the wider picture’.
“We also believe it is in clients’ best interests to have the option to access the speciality markets based in London for the risks that are best dealt with there,” he said. “This means that unimpeded cross-border trading must be maintained. We ask for help from those in Europe that share that same belief to ensure that financial services are not excluded from any future trade agreement.”