The insurance industry is stepping up its lobbying efforts to prepare for Brexit as it faces losing business to other parts of the EU.
John Nelson, chairman of London’s commercial insurance market, Lloyd’s, met the prime minister’s business advisory group on Thursday and will speak to Sajid Javid, the business secretary, next week in an effort to push the industry’s case.
The London Market Group, which represents insurers and brokers in the commercial market, is also meeting parliamentarians.
The industry is keen to make sure its voice does not get lost in the clamour of groups pushing their case ahead of the exit talks.
Financial services are expected to play a big role in the negotiations, but insurers are concerned banking will dominate.
“We’re all singing in the same choir, but our harmonies are slightly different,” said Huw Evans, director-general of the Association of British Insurers this week.
“We need to recognise that there are sector specific issues, not just generic financial services sector issues,” he added. One of those specific issues is regulation of the insurance industry. Mr Evans believes there is scope for regulators to help UK insurers become more competitive.
Lloyd’s, which campaigned for a Remain vote, has outlined its plans as it prepares for life outside the EU. In meetings with the insurers that operate in the market, chief executive Inga Beale laid out a twin-track approach.
Lloyd’s is campaigning to retain “passporting rights” — which allow insurers to operate across the EU — but is also putting in place plans for how the market can operate in the continent if those rights are lost.
Lloyd’s says that only about 4 per cent of its £27bn worth of annual premiums are at risk because of Brexit. It has been keen to stress that policies written before any formal exit — including multiyear policies — would remain valid.
The commercial insurance market is a big part of the City’s economy. According to London Matters, a 2013 report, it employs 34,000 people and contributes about a fifth of the City’s gross domestic product. Many of the big insurers who have set up shop in London have done so because of the UK’s passporting rights into the EU.
Without those rights, insurers say they would have to set up new operations within the EU. An executive at one insurer says that his company might be forced to send up to two-fifths of its London workforce to other cities over the next five years.