1. Reduction in capacity in the Irish market - A significant amount of the capacity in the Irish non-life insurance market is provided by Irish branches of UK companies. Unless an EEA type agreement is concluded between the EU and the UK guaranteeing UK access to the Single Market or unless those companies replace that capacity with an EU-based carrier, then that capacity will be lost to the Irish market. This would result in a less competitive market and higher premium costs. A number of UK headquartered life companies are also active in the Irish market and they will need to look at alternative ways of maintaining their Irish market presence.
  2. Curtailment of insurance opportunities in the UK - Many multi-national insurance groups use Ireland as their base for European wide business. Once the UK exits the EU, those companies will need to reappraise how they write their UK business to see whether their UK activities would need to be authorised in the UK. The same may be faced by insurance intermediaries to the extent that they transact in the UK market.
  3. Reinsurance issues - It is virtually inconceivable that the UK would not achieve equivalence under Solvency II rules and, therefore, the reinsurance and retrocessionaire capacity available in Lloyds and the London market is likely to continue to be available to EU carriers and reinsurers. However, the UK would have to obtain the EU's agreement to arrive at this position.
  4. Increased volatility - It is likely that UK and EU markets will become increasingly volatile which will pose challenges for (re)insurers across Europe in terms of their capital position, investment portfolio and liquidity.
  5. Other issues - Many of the other issues raised elsewhere in this briefing (e.g. in relation to taxation, data protection, capital markets, litigation, employment and pensions and competition) will apply equally to the European (re)insurance industry.