Market split over Brexit referendum
Brokers take their sides although some complain of lack of information with EU vote looming
The EU referendum on 23rd June is an issue currently dividing the country. Some in the sector are firmly decided which way they will vote on whether or not the UK should opt for Brexit. Others though are still confused and say they would like more information such as facts and figures from trade bodies and insurers before they make a decision.
On the one hand the government and many industries – including insurance representatives – have argued that it is much safer to remain in the union. Just last month US president Barack Obama on a trip from over the pond stated that staying in the EU would be the best course of action.
On the opposite side of the debate the leave campaign, which includes London Mayor Boris Johnson along with Ministers such as Michael Gove, insists that the UK will be better off freed from the shackles of the European Union.
Another in the exit camp, although not proactively campaigning, is ex-broker Craig Tracey MP. He outlines his reasons for being in favour of Brexit in the interview later in the publication.
But what about those at the sharp end of the insurance world? The Insurance Age Sentiment Survey (pages 35-37 in the publication) showed a mixed response from brokers on the issue.
Participants were asked ‘will brokers benefit from a Brexit? Almost 16 percent said leaving the EU would benefit the market but 40 percent believe an exit would be unhelpful. Over a third (34 percent) simply do not know, while the remainder feel l leaving the EU won’t make any difference. One broker, Geoff Bishop, who runs his own brokerage, said there has been a lack of information about Brexit. He commented: “in the absence of information I go with my gut instinct:’ Adding: “It is not just about insurance… you have to go with the greater good. We can survive without the EU:’
Neil Barlow is a director at Copperwheat Barlow – he wants to leave the EU for a number of reasons, one being to escape the bureaucracy placed on brokers by EU regulations. He argued that brokers need more evidence to base their decision on. “‘There is not really enough information;’ stated Barlow. “To get the detail I require l have had to look on other databases: ·
Meanwhile Innovation Group’s Paul Dickson is very much on the remain side of the fence. “We are definitely supportive of staying in the EU;’ he said. Dickson continued: ” in my view this is a journey we have been on for a long time and it would be unthinkable to get off the train when there is so much benefit to the insurance industry if we remain part of the club:’ He countered that there has been plenty of information available to brokers and praised the work done by trade bodies in insurance to share information about Brexit without being extreme
“I think the bodies have done a respectable job in presenting a factual overview. They have contributed helpfully without being partisan; ·Dickson concluded.
However, one broker felt, insurers could have done more to explain how Brexit could change the insurance world. Philip Bower, development and marketing manager at Sutton Winson, told Insurance Age: “There has been a lack of information released by insurers but Lloyd’s of London have made their position very clear’.’ Lloyd’s is firmly in the ‘in’ camp.
He remarked that Brexit would have little impact on Sutton Winson’s business and said that the broker does not have an official position on whether in or out is the best course of action for the market.
In keeping with Dickson’s view, another market source praised the British Insurance Brokers’ Association (BIBA) as a shining light for its information-flow during the referendum debate. With brokers clearly thirsty for knowledge, the trade body’s session on Brexit at its conference is bound to be a must-attend part of the Manchester event
The view from Scotland
• Scottish brokers have already worked through one secession vote recently – the Scottish Independence Referendum. The result saw them stay part of the UK, but what was the impact on business at the time and are brokers worried about how the Brexit vote will affect the market?
Eric Richardson, managing director at Scotland-based broker Boyd & Company, said the market in Scotland experienced “uncertainty” in the lead up to the Scottish independence referendum in September 2014. ‘There was uncertainty in clients embarking on projects and people were pulling back in committing to things. ‘We are seeing a little bit of the same with the EU referendum but it isn’t as extreme.”