Insurance leaders have welcomed the EU withdrawal agreement as a ‘step forward’ for the industry - but have further warned against the UK becoming a rule-taker.
Following EU leaders’ approval of the Brexit Withdrawal Agreement and Political Declaration, negotiated by Theresa May, ABI director general Huw Evans said that an orderly withdrawal process is ‘vital’ for UK consumers. But he added there is a long way to go before the UK’s continued future as a world leader is secure.
Mr. Evans said: “The agreement by EU leaders is another step forward. It remains vital for our industry’s customers that we have an orderly withdrawal process and transition period, and any progress towards that is welcome. Regulatory co-operation is very important and must follow from any political agreement.
“The crucial longer-term test is whether our future relationship with the European Union avoids our world-leading insurance and long-term savings sector becoming a rule-taker. It remains far too early to judge whether we will be able to avoid that fate.”
Before Sunday’s agreement, UK insurers had warned of the potential difficulties facing their industry, with the ABI saying it would ‘defy common sense’ not to have a Brexit deal on financial services. Mr. Evans said in March: “The insurance and long-term savings sector is already well integrated and our regulations are aligned so if the will is there, a deal that works for everyone can be done.
“Insurers across the EU and in the UK must have legal certainty they can pay their customers and it is vital we maintain the flow of skilled labour between the UK and EU that will keep the UK a world leader.”
According to the ABI, the UK insurance and long-term savings industry is the largest in Europe and the fourth largest in the world, managing investments of £1.7 trillion and paying nearly £12bn in taxes. It also employs more than 300,000 workers.
Since the referendum vote to leave the EU in June 2016, the insurance industry has faced a number of questions, such as whether the UK will lose its ‘passporting’ rights allowing insurers to freely underwrite policies and sell insurance products to EU countries without barriers.
Labour, the Liberal Democrats, the SNP and the DUP, as well as many Tory MPs, have all said they will vote against the withdrawal agreement. This week, Mrs. May has challenged Labour leader Jeremy Corbyn to a live TV debate, accusing him of offering no alternative Brexit plan. The formal process of leaving the EU begins on March 29, 2019.