Americas editor comment: Brexit's North American impact - FREE

Americas editor comment: Brexit's North American impact - FREE

 US UK flags webThe implications of the UK’s vote to leave the European Union – the much discussed “Brexit” referendum – on the North American insurance and reinsurance industry remains, as yet, fairly opaque.

For Bermuda, the island’s recently acquired Solvency II equivalence status will stand it in good stead when negotiating with European clients. That there may well be passporting problems for European cedants looking to purchase protection from either Lloyd’s or the London market in the UK which, presumably, will have to apply for its own Solvency II equivalence now, could bring even more business to Bermuda’s risk carriers.

Whether that’s actually the case or not remains to be seen, but senior figures on the island are bullish about the opportunities Brexit may bring.

As Bradley Kading, the president and executive director of the Association of Bermuda Insurers and Reinsurers, noted, “Bermuda’s Solvency II equivalence finding by the European Union will serve us well as the UK negotiates its multi-year transition out of the EU”.

The president of the Bermuda Insurance Management Association, Grainne Richmond, is in no doubt that the EU would be stronger with the UK as a member. However, Richmond said the British people’s choice must be respected. And while she admitted that it was premature to comment on any effects the vote will have on Bermuda’s captive industry, BIMA and its members will be monitoring the UK’s process to withdraw from the EU closely.

The Bermuda Development Agency’s chief executive, Ross Webber, was less cautious though, and like Kading pointed to the island’s Solvency II equivalence as to why it stands in such good stead.

“Attributes such as our stand-alone Solvency II equivalence with the EU and our progressive path towards Alternative Investment Fund Managers Directive passport rights in Europe may now appear even more attractive than they were ,” said Webber.

Elsewhere, question marks must also be raised about the so-called covered agreement that the EU is currently negotiating with its counterparts in the US.

As noted in early July, the American Insurance Association, Insurance Europe, and the American Council of Life Insurers have all once again reiterated their support for the full inclusion of insurance and other financial services in the Transatlantic Trade and Investment Partnership (TTIP).

As it stands, insurance is not included within the TTIP conversations, but various industry bodies have called for that to change.

“Transatlantic trade and investment benefit those on both sides of the Atlantic by stimulating economic activity, job creation and competitiveness,” industry body Insurance Europe said in a statement.

TTIP negotiations are scheduled to continue throughout the month of July, and it would be a surprise if the topic of the UK’s withdrawal from the EU and its impact on these discussions was not raised.

“The TTIP can increase insurance trade and investment between the US and EU, set a high standard for future trade negotiations with third parties, and facilitate dialogue between regulators on both sides of the Atlantic,” added Insurance Europe.

Obviously the EU is home to some of the largest reinsurance companies in the world, even without the UK being a member of the trading bloc. But it will be interesting to see if attitudes to the TTIP change because of the UK’s imminent withdrawal.

Reactions readies for North America event, awards

Reactions will once again be hosting its North America Conference and Awards Dinner this September.

This year’s events are taking place after the madness of Monte Carlo, so it will be a welcome respite for those weary travellers who made the trip to the principality.

The Reactions North America Conference will take place on Wednesday, September 28, while the North America Awards Dinner will be hosted on the evening of Thursday, September 29.

As in recent years, our 2016 North America Awards Dinner is once again taking place at the glamourous Cipriani Wall Street. The great and the good of the North American insurance and reinsurance market will don their finest tuxedos and ball gowns as they celebrate those individuals and companies who have left their mark on the industry over the course of the last 12 months.

Anyone interested in either sponsoring or attending the dinner should contact my colleague Goran Pandzic on +1 212 224 3711 or via email – gpandzic@euromoneyny.com

By Christopher Munro, Americas Editor - christopher.munro@euromoneyplc.com

Latest Issue

July/August 2017

reactions-latest-issue  

In this month's Reactions

  • Brexit movers
  • Axis-Novae
  • Stephen Catlin's memoirs
  • London Market Awards

Click here to view this issue

 

Follow Us on Twitter @reactionsnet