The Bank of England have today warned of a ‘material’ risk to insurance contracts and payments from Brexit.
The Bank’s Financial Policy Committee said: Since November, in the United Kingdom, progress has been made towards mitigating risks of disruption to the availability of financial services. Nonetheless, material risks remain, particularly in areas where actions would be needed by both the UK and EU authorities … Insurers in the UK and the European Economic Area (EEA) may not be able to pay claims to, or receive premiums from, policyholders in the other jurisdiction. Based on latest data, this could affect around £27 billion of insurance liabilities and 10 million UK policyholders. Around £55 billion of insurance liabilities and 38 million EEA policyholders could also be affected.
Commenting, Alison McGovern MP, leading supporter of the Open Britain campaign, said:
“The risk to insurance payouts is another example of information about the impact of Brexit that no one could possibly have known about at the time of the referendum.
“Even now, a year after Theresa May said she planned to take us out of the EU, we still do not know what Brexit will cost and about the full range of impacts Brexit will have.
“And as more and more information about the risks that Brexit brings comes to light, it is right that we ask if it is the right direction for our country.”
Notes to editors
The Bank’s full statement is at: https://www.bankofengland.co.uk/-/media/boe/files/statement/fpc/2018/financial-policy-committee-statement-march-2018.pdf?la=en&hash=61059A79F4453B2EFA6BA88A598739DD67FC0CD7