Leaving the EU without a deal not acceptable, warns ABI

Leaving the EU without a deal not acceptable, warns ABI

Source: Insuranceage

Trade association says that if no Brexit deal is in place insurers may not be able to continue to meet the needs of millions customers and remain legally compliant.

The Association of British Insurers (ABI) has warned that leaving the EU with no deal in place is “not acceptable if insurers are to continue to meet the needs of millions of customers and remain leagally compliant”.

ABI director general Huw Evans warned delegates in a speech at the ABI’s ‘Brexit – the road ahead’ conference that customers could be hit by the lack of a Brexit deal.

He stated: ““It is unacceptable not to have a Brexit deal at the point at which we leave in 2019. As the chancellor said in the Mansion House speech, the Brexit process has to be delivered in a way that enables
business to operate, and our customers not to suffer any unnecessary detriment.

“To meet our clients’ needs as an industry and ensure full compliance with the law, the government has to deliver an orderly withdrawal, a stable transition and a sensible and mutually beneficial future trading relationship.”

Safeguard

To safeguard the needs of customers Evans noted that a deal will take time and stressed that it was more important to “get things right” than to “pretend things are simpler than they are and set artificial
deadlines”.

He added:  “We need cross-party parliamentary co-operation to make the legislative process work. We would like to see a framework established for formal cooperation between the main parties in Westminster and between the two Houses of Parliament.”

According to the ABI issues that need to be resolved are:

The treatment of contracts written pre-Brexit and still in force post-Brexit which includes business liability contracts. The risk is that, as a result of leaving the Single Market, insurers lose their licence to do insurance in the customer’s jurisdiction, and therefore cannot legally fulfil the contracts.

The European Health Insurance Card (EHIC). Clarity is needed as soon as possible given insurers offering annual travel policies in April 2018 will have to prepare for the possibility of covering these treatment costs after the UK is set to leave the EU in March 2019.

Driving abroad: The motor insurance ‘Green Card’ guarantees that motorists have third party insurance when visiting other countries.
The current system also provides victims with a route to compensation in their own country (and language) when a visiting motorist causes damage. Without a deal motorists may need to buy extra cover if they
plan on driving to Europe and might also need to bring a physical Green Card with them for insurance checks at borders. This is similar to arrangements in place before the UK joined the Common Market. Those
making a claim may also have to pursue claims with foreign bodies, potentially in a language which they are unfamiliar.