The London and International Insurance Brokers Association (Liiba) has outlined its IDD Brexit fears to the UK prime minister.
The letter from chair Roy White highlights the insurance distribution directive’s (IDD) lack of equivalence provisions.
White writes that the government’s proposals for financial services treatment post-Brexit concentrate on a concept of “enhanced equivalence” to govern market access, which won’t work for insurance intermediaries.
As it stands, enhanced equivalence will mean brokers will lose access to European markets, argues White.
Liiba is seeking to ensure that any future trade agreement will allow its members to continue to deliver services to EU clients and to place EU risks, he said.
A foundation
In a LinkedIn post, Liiba chief executive Christopher Croft, said: “The government’s white paper provides a measured foundation from which the right future trade agreement for financial services could be built.
“We understand in general why that focuses on the existing equivalence regimes but our own relevant directive – the IDD – has no such concept. We are keen to work with the government to help find a pragmatic way forward.”
Insurance law expert Tobin Ashby of Pinsent Masons, said: “The lack of an existing equivalence regime for existing insurance-related activity across borders in the EU does mean that a loss of passporting currently leaves no similar option for intermediaries as things stand.
“The documentation issued by the UK Government so far does not provide the level of detail needed to understand how the proposed approach would work in practice, so it is not surprising that the industry is seeking clarification and looking to encourage the negotiation of a suitable framework, if enhanced equivalence is to be the negotiated position,” he said.
