June 2016
Lloyd’s chairman John Nelson has issued a statement in the wake of the UK’s EU referendum result, with a clear message that business will carry on as usual.
“I am confident that Lloyd’s will stay at the centre of the global specialist insurance and reinsurance sector, and I look forward to continuing our valuable relationship with our European partners,” he said.
“For the next two years our business is unchanged. Lloyd’s has a well prepared contingency plan in place and Lloyd’s will be fully equipped to operate in the new environment.”
The Association of British Insurers’ director general Huw Evans has stressed that the UK will remain part of the EU until the process of leaving is complete.
He added: “For the UK government, it will be important now to focus on ensuring the UK remains a globally competitive place to do business with the best possible future trading network with the EU and the wider world.”
Mark Knight of the London & International Insurance Brokers’ Association (Liiba) told The Insurance Insider that nothing definitive was going to happen “for a long time” as the country comes to terms with the outcome of the vote, and that firms should continue to trade as normal.
“This is especially true for the regulatory regime. The Financial Conduct Authority (FCA) has extra staff on its contact centre today and that will be open tomorrow if firms have specific questions. But there will be no immediate change in the regulatory regime. So, again, business as usual,” he said.
“There will clearly be volatility in the foreign exchange and other capital markets but these will at some stage find a level. Liiba will be working with the other associations and Lloyd’s and via the London Market Group to ensure the market’s voice is heard once discussions as to how the UK seeks to implement the outcome of the referendum.”
The FCA also issued a comment, stating that it is in close contact with the firms it supervises and the Treasury, as well as the Bank of England and other authorities.
“Much financial regulation currently applicable in the UK derives from EU legislation. This regulation will remain applicable until any changes are made, which will be a matter for government and parliament,” the watchdog said.
“Firms must continue to abide by their obligations under UK law, including those derived from EU law, and continue with implementation plans for legislation that is still to come into effect…
“The longer-term impacts of the decision to leave the EU on the overall regulatory framework for the UK will depend, in part, on the relationship that the UK seeks with the EU in the future. We will work closely with the government as it confirms the arrangements for the UK’s future relationship with the EU.”
The British Insurance Brokers’ Association (Biba) has said it will work with government to ensure that the best interests of insurance brokers and their customers are fully represented during the exit negotiations.
“This is an unprecedented situation for the UK and Biba is conscious that this will create a considerable amount of work and concern amongst members and their customers,” it continued.
“The process of negotiating exit terms, setting out future arrangements with the EU and creating trading deals is likely to take some considerable time and will impact our industry during that period.
“Biba will work with the government and other authorities to ensure that the interests of insurance brokers and their customers are fully represented in these vital negotiations. Biba will make this a priority work stream during this time.”
And Sergio Balbinot, president of lobbying firm Insurance Europe, said he was “deeply saddened” by the UK electorate’s decision to leave the EU, adding: “We now hope that policymakers can work quickly to limit the impact that this time of uncertainty will have on both consumers and businesses.”
