London market insurance professionals’ attitude towards a potential UK exit from the EU appear to have softened, ahead of June 23’s UK referendum.
Almost two thirds of insurance professionals admitted to a crisis of confidence over UK membership of the EU, according to one study commissioned by Moore Stephens.
The survey showed 61% of industry employees testifying a “loss of faith” in the EU.
Despite this, 62% believed a Brexit would be too drastic a solution, with 68% think leaving the EU would harm the London insurance market.
Another study, this time commissioned by PR firm FWD and focused on London market brokers, showed the number of brokers in favour of Brexit increasing from 22% to 26%.
That survey found that between March and May 2016, the number of brokers reporting they were backing the UK to remain in the EU fell from 43% to 39%, with a constant 35% undecided.
According to the Moore Stephens survey, “Brexit: Dawn of a new era or the beginning of the end for the UK insurance sector”, 40% of employees in the insurance sector do not share the same view as their employers on quitting the EU, revealing a chasm between personal opinions and the corporate positions taken by London market firms.
The FWD study reported the number of brokers who said they considered their business prepared for Brexit had almost doubled from 16% to 31%.
While national polls suggest the June 23 vote is too close to call, FWD said 69% of brokers thought their businesses were unready to cope with a Brexit.
“The insurance industry is evidently deeply conflicted about the future of Europe; however there seems to be a strong belief that a Brexit would negatively affect the UK insurance market,” said Paul Latarche, head of Moore Stephens’ insurance sector group.
“It seems unlikely, however, that Brexit would spell regulatory bliss for insurers. A wholesale rollback of regulatory pressures originating from the EU after a ‘leave’ vote is unlikely. For instance, major European-level initiatives such as Solvency II have already been incorporated into UK law,” he said.
“Ultimately, though, it seems clear that whilst industry professionals may have lost faith in the EU, they are united on acknowledged the negative effects of a possible Brexit,” Latarche added.