Risk managers advised to check policies as not all UK insurers have created EU ops

French and other EU-based risk managers need not panic about the continuity of their coverage with UK and London market insurers, and ability to receive claims, post-Brexit, according to a panel of experts at the AMRAE conference in Deauville. But they are advised to check polices because not all UK insurers have created EU subsidiaries. Risk managers can rest relatively easily as the Brexit deadline looms, because the vast majority of carriers have already enacted their worst-case no-deal scenarios. Most have set up EU operations in Belgium, Dublin, Luxembourg or elsewhere to service EU-based business, and transferred existing policies to the new carriers via so-called Part VII transfers, explained the experts. But the panellists agreed that, while the majority of UK insurers that have European customers have already set up EU-based and EU-regulated companies, there are some exceptions. Risk managers need to act fast, contact their brokers and double check the validity of their coverage after 29 March, the date the UK is scheduled to leave the EU. "Most UK-based insurers that do business across the EU have already enacted their post-Brexit plans, created EU-based operations and transferred existing policies via Part VII Transfers. We at QBE moved quickly and received approval from the National Bank of Belgium to create our subsidiary in Belgium and the Part VII Transfer took place on 1 January 2019. It took a lot of work but we are ready and so are many others," explained Chris Wallace, executive director for European markets at QBE International. "But I would advise risk managers to check their coverage with their brokers because not all UK insurers have done this. A survey was recently published that showed that about 20% of companies have no Brexit plan. This is a risk," he continued. Pushed later on why insurers that do business with EU-based brokers and customers would not have enacted a no-deal Brexit plan, Mr Wallace cited overoptimism as a potential reason. "I do think that parts of the market thought that this would just naturally evolve and a market-wide solution would be found. Check with your broker and insurer. There is a lot of support out there," he said. So what are the main Brexit-related risks that risk managers should focus upon once they are assured their coverage is valid and valid claims will be paid? Mr Wallace said tax needs to be examined because once the UK leaves the EU it will be working under different international tax laws, if there is no deal. Contracts will need to be closely looked at, particularly those involved in the supply chain. Mr Wallace said a checklist of how new contracts are created would be advisable. Another key area is, of course, employment. Companies need to check the status of their staff and make sure they can continue working under the new rules. Other important areas to consider are intellectual property and data protection. After any transition period the UK may operate under different rules, so this has to be considered sooner rather than later, said Mr Wallace. But it is not all doom and gloom. Mr Wallace and his co panellists – Nicholas Aubert, CEO of Willis Ltd, the broker’s principal UK regulated entity, and Olivier Hautefeuille, chief underwriting officer, industrial and commercial risk at SCOR Global P&C – agreed that there will be opportunities for insurers and their clients from Brexit. "Much has been said about the uncertainty, implications and concern about what will happen, but we should also look at the opportunities. If an insurer has a strong footprint in the EU and the expertise, then they have a strong opportunity to grow that business by being closer to the customer," suggested Mr Wallace. "Customers will face new risks as a result of Brexit and this presents an opportunity for the market to help them through this process. This could be a catalyst for change throughout Europe, to do things differently and support customers in an ever-changing environment," he added.

Risk managers advised to check policies as not all UK insurers have created EU ops

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