No deal Brexit planning
The European Commission and EU 27 countries are planning for the consequences of a hard Brexit in case Britain leaves the EU on 29 March with no deal agreed. These includes measures to try and minimise supply chain disruption and ensure the continuity of key personnel.
For example, Germany and the Netherlands, as two of Britain’s biggest trading partners, have hired hundreds of additional customs officers to keep trade flowing through major ports like Rotterdam.
As the only country with a land border with the UK, Ireland will have 400 new customs officers in place by the end of March to deal with the added workload in case there is a hard border with Northern Ireland. The future of the border is currently the most contentious issue as negotiations over an exit deal for Britain continue toward the last moment.
Still notably missing from the European Commission’s plans, however, is any form of continuity for EU27 policy holders with insurance contracts written in the UK, as described in the article by Dave Matcham from the International Underwriting Association (IUA) in the FERMA-Airmic Brexit newsletter.
The French government, however, adopted two statutory instruments on 6 February 2019 relating to financial services and insurance. These take the form of ordonnances which will become law once validated by Parliament and will enter into force in the case of the UK withdrawal with no deal.
One ordonnance clarifies the rules applicable to insurance contracts entered into before Brexit on the basis of the European Economic Area (EEA) insurance passport. Insurance buyers in France will be relieved to find that claims can legally be paid by UK insurers in the EEA in the event of a no-deal Brexit, but the insurers will only be able to renew policies if they have an EEA entity. In practice, this already applies to most UK insurers underwriting commercial business.
In its latest round of no-deal planning, the European Commission has detailed the creation of a fund to offset the impact of a sudden loss of access to UK waters for EU27 fishing vessels. In addition, the Commission has announced that it will grant the UK access to EU27 waters until 2019, so long as the UK grants reciprocal access to EU27 ships in UK waters.