On Leaving Europe

Sean McGovern, Lloyd's Chief Risk Officer and General Counsel, leading the EU 'Yes' campaign

Sean McGovern, Lloyd’s Chief Risk Officer and General Counsel, in favour of UK remaining in the EU

True, emotions were running high over the exorbitant costs of implementing Solvency II, widely seen as a project poorly mishandled in Brussels, but in adding his signature to an open letter to The Times in January 2013 supporting David Cameron’s yes/no referendum strategy on UK’s European Union (EU) membership, Lloyd’s Chairman John Nelson may have sent a hawkish signal to producers on the Continent whose business many of us in the London Market have fought hard to cultivate. Far better, therefore that this position has since softened to the point that Sean McGovern, Lloyd’s executive spokesperson on the subject, has now declared the market to be unequivocally in favour of UK staying in the EU apparently regardless of whether the negotiations promised by the Conservative Party after the next election deliver anything at all from our European partners: and quite right too.

In his most recent article in the London Insurance Institute Journal, Sean sets out the implications for the UK insurance industry of leaving the EU and they are wretched. In a nutshell becoming a ‘third country’ in Euro-parlance means UK insurers would lose their automatic access to business in 28 countries with an audience of 500 million people and worse still remain completely bound to a regulatory framework with little or no influence on how it evolves. With £6 billion of premiums from the Continent at risk, the potential damage to the world standing of the London Market is very serious. The ever-jovial leader of the anti-Europe campaigners UKIP, Nigel Farage, needs to understand that in our industry an EU exit is not a laughing matter; countless insurance jobs could be lost if his party has its way and we retreat to within our own borders.

Unfortunately, even if the Tories lose the next election so the referendum does not take place or there is a referendum and the electorate vote yes, the current period of uncertainty which will continue for at least another three years could in itself damage the flow of business from Europe. All the more reason therefore that insurers in UK should follow Sean’s advice and contribute to the debate on EU membership so that the views of our sector are heard not just by the voting public domestically but also across the channel where clients and brokers need reassurance that London is still committed to European business development.

 

 

 

 

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One Response to On Leaving Europe

  1. Sarah Miles says:

    Reblogged this on thechristchurchfiasco and commented:
    For those of you with a deeper interest in insurance/reinsurance.

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