Insurance market Lloyd’s of London is said to be ramping up Brexit contingency plans with hopes to unveil an alternative location for part of its business by February.
With Britain’s exit from the European Union approaching, the UK’s position at the centre of the insurance market may be in jeopardy, according to chairman John Nelson. Operations may start leaving London before Brexit negotiations are concluded unless the Government can provide “clarity” about the UK’s future relationship with the EU, reports The Independent.
After the referendum, Lloyd’s announced it would consider its options for maintaining access to the EU single market, including a subsidiary. A subsidiary within the EU would allow Lloyd’s to continue trading across the bloc, without needing to apply for authorisation in each separate member country.
The 328 year-old organisation sees 11% of its revenue from EU accounts.
It is understood that Lloyd’s has shortlisted five EU cities that could house a portion of its operations after Brexit in a bid to protect its European revenues. There is speculation that this trend will continue – with rival financial centres like Dublin, Frankfurt and Paris siphoning off some of the City’s business and taking advantage of the uncertainty surrounding Brexit.
“Following the referendum we committed to looking at the options that would allow the Lloyd’s market to continue trading seamlessly with the EU. This included establishing a subsidiary model amongst others.” a Lloyd’s spokesperson said.
“We will continue to develop our plans on creating a subsidiary and will provide a detailed update to the market on the progress we have made early next year.”
“We believe it is in the interests of the City to have ease of access to the EU’s single market and we will continue to work with both the industry and the government in any way we can on this,” the spokesman said.
The insurance market is likely to outline the potential costs of a partial relocation to members when it suggests a new site in February.
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