All EU member states, and the EEA countries of Norway, Iceland and Liechtenstein, have indicated that they will comply with Recommendation 9 of the European Insurance and Occupational Pensions Authority’s (EIOPA)’s ‘Recommendations for the insurance sector in light of the United Kingdom withdrawing from the European Union’.
The adoption of Recommendation 9 by European national regulators means other than where all intermediaries in the chain are authorised within the EEA/EU, Lloyd’s Europe is not able to accept new or renewing business (both insurance and reinsurance) from intermediaries where the risk in question is for a policyholder in the EU/EEA state and the risk location for that risk is within the EU/EEA. This primarily impacts brokers and coverholders that have their authorisation in the UK from the Financial Conduct Authority (FCA) and previously conducted business within the EU in reliance on passporting rights.
During 2020 Lloyd’s contacted all brokers and coverholders who were no longer be able to bring impacted business to Lloyd’s Europe to explain the changes and the steps that needed to be taken.
Lloyd’s Europe is working to ensure that, following Brexit, Lloyd’s policyholders across the EU/EEA can continue to access the underwriting expertise and financial security of the Lloyd’s market and their existing policies can continue to be serviced by the Lloyd’s market, including the payment of valid insurance claims. Where brokers and coverholders have established EU/EEA authorised companies Lloyd’s Europe has established fast track processes to onboard them.
Following the adoption of Recommendation 9, Lloyd’s Europe needs to make changes to the business it can accept through non-authorised intermediaries. Recommendation 9 also has implications for the administration of business to be transferred to Lloyd’s Europe pursuant to the Part 7 scheme undertaken by Lloyd’s in December 2020. Complete information on the requirements for Brokers and Coverholders and on the options for transferring the servicing of the business is included in the EIOPA Recommendation 9 guidance.