May 2016
Richard Brindle’s start-up Fidelis would probably not have been headquartered in London if it had been launched following a UK vote to leave the European Union.
Speaking to The Insurance Insider, entrepreneur Brindle warned of the sclerotic effect a “Brexit” would have on the ability of companies like his to trade, and the added bureaucracy of dealing with 26 different regulators.
“I think it’s highly likely that if we were starting a business post a Brexit vote, we would have established an office in London to access the brokers, but we would probably be headquartered elsewhere in the EU,” he told this publication.
Specialty (re)insurer Fidelis launched with around $1.5bn of capital last July after Brindle exited Lancashire, the specialty insurer he founded in 2005.
Brindle spoke of the speed with which UK regulator the Prudential Regulatory Authority awarded Fidelis EU-wide passporting approval, with the whole process wrapped up inside 30 days.
He added that receiving the EU stamp of approval was a key factor in setting up the business in London and warned of the uncertainty that came with a potential exit.
“The ‘Leave’ camp has some very intelligent people on its side, but the thing I’ve found most striking while listening to them is that they don’t have an answer when asked a question about what happens next in terms of financial services.
“They talk glibly about how everybody will want to be our friend and want to sign treaties with us, but that’s far from guaranteed,” Brindle continued.
The Fidelis CEO said that it was the job of the insurance industry to stress the uncertainty of what would happen following a Brexit and stated that the Leave campaign did not deserve to win a referendum without being able to clearly articulate what the aftermath would look like.
“The campaign has consisted of sepia-tinted nostalgia for an imagined past that probably never existed, but also an inability to really get into the detail,” he said.
On the topic of attracting insurance talent from those within and outside the EU, Brindle stressed the importance of keeping the conversation “appropriate and dignified”.
Brindle also argued that for an industry that has prided itself on its ability to trade in every corner of the world and attract the very best talent from all over the globe, it is crucial that the debate does not give an impression that the UK is falling into “Little Englandism”.
In addition, the executive noted the “sophistry” of the Leave campaign in saying that an exit would secure the UK’s borders against EU migration.
“In all likelihood the first demand of our European partners in negotiations for a post-Brexit treaty would be the maintenance of freedom of movement – invalidating the whole anti-immigration thesis.”
The entrepreneur went on to argue that if the London market spoke as one voice against Brexit it could have a powerful impact.
“Lloyd’s of London is about as British and iconic as it gets,” Brindle said. “And here you have the chairman and CEO of the International Underwriting Association (IUA) and the chief risk officer of Lloyd’s all voicing their acute concern about what’s going to happen in a few weeks’ time, and that’s something that I think will resonate with the broader public.”
The Lancashire founder added that over the next few weeks he would be working closely with Dave Matcham and Malcolm Newman, CEO and chairman respectively of the IUA, and with Lloyd’s chief risk officer Sean McGovern to make the case for remaining in the EU.
His comments come after the IUA issued a stark warning last week against the UK voting to leave.
“The feedback we have received from our members clearly shows that the benefits of EU membership are highly valued and the possibility of these advantages disappearing is of grave concern,” said Dave Matcham.
In its statement calling for a “remain” vote, the trade body warned that UK businesses were in danger of losing the substantial benefits attached to the EU financial services passport.
