A report from Standard & Poor's (S&P) says that Britain's decision to leave the European Union has not increased the amount of risk faced by the country's life and property/casualty insurers.
In its most recent assessment of the United Kingdom, S&P says that overall risk levels for insurers remain low despite the recent vote in favour of Brexit. Although the British insurance industry makes up about a third of the UK's financial services net export surplus, the ratings agency believes insurers are less exposed to danger because they do much more business with countries outside of Europe, especially with the United States.
"The nature of the trading relationship between the U.K. and the EU is yet to be established. However, even in the worst-case scenario of there being no trade agreement and the ending of passporting rights, we believe that U.K. firms operating in the EU would be able to establish EU subsidiaries and continue their businesses largely uninterrupted," says S&P. "Our intermediate industry risk assessment for the life sector captures the typical level of risk that life insurers operating in the U.K. face, and remains unchanged post the Brexit referendum."