The London Market Group (LMG), which represents the insurance and reinsurance market in London, has published its recommendations to the UK Government in its Brexit negotiations.
The LMG said a trade deal that provides mutual benefits to both the UK and the EU is within the Government’s reach.
The report highlights three key areas:
- The need for a guarantee that the London Insurance Market will be considered to have regulatory equivalence with the EU
- A new trade deal with the EU, which gives both UK and EU insurers, reinsurers and brokers continued rights to undertake cross border activity.
- The early agreement on an implementation period to avoid a cliff edge on the day the UK leaves the EU
LMG chairman Nicolas Aubert commented: “Since before the referendum LMG has focused on building important relationships with Government and we appreciate their willingness to develop an ongoing dialogue. As a result of these discussions they understand that a new deal is critical.
“Over £8billion of EU business comes to London. So, we are continuing to work closely with the Government to see where there are existing precedents in current international agreements which could be used for the Brexit negotiations to support our industry.”
Aubert continued: “Our competitor hubs in Bermuda, Dubai, Singapore and Zurich have regulators with duties to actively support the promotion of their local insurance markets. The FCA and PRA do not have such objectives and we think there would be value in giving them a balancing statutory objective to consider the impact of their actions on the competitiveness of the financial services sector.”
He added that the LMG would also like to see the creation of a dedicated inward investment unit in the Bank of England to support and encourage new entrants to the UK as well as retain those currently present through the implementation of the new agreement.
“This would ensure that our regulators maintain a day-to-day focus on helping to maintain London as the global centre for specialty commercial insurance and reinsurance,”said Aubert.
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