As Great Britain triggered Article 50 in order to formally begin Brexit, the massive insurance marketplace plans ahead.
The largest specialty insurance market in the world, Lloyd’s of London, has selected Brussels as its intended European Union subsidiary. The decision was made on the eve of the day British Prime Minister Theresa May triggered Article 50 of the Lisbon Treaty with the E.U. This has launched Great Britain’s official intention to leave the E.U.
The insurance market made this decision in order to ensure a subsidiary will be in place after Brexit.
Lloyd’s of London has been among the financial services firms in Great Britain’s capital which have been the most outspoken about their requirement for a European Union subsidiary after the country exits the bloc. At the start of this week, Lloyd’s had narrowed its options to six different potential locations, said a Reuters report. The last two on the list were Brussels and Luxembourg, after having ruled out Paris, Frankfurt, Malta and Dublin.
Lloyd’s of London may move only a few dozen of its staff members to the new subsidiary location.
This pales in comparison to the number of people expected to head out to subsidiaries from other financial institutions. Many banks plan to shift hundreds of people out of London and over to their E.U. subsidiaries, said sources quoted by Reuters.
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That said, the Lloyd’s decision may end up affecting the plans made by a spectrum of other insurance companies. “As other larger insurers announce their decisions on this matter, it helps inform our choice – we are happy to benefit from their analysis,” said an insurance company CEO quoted by Reuters.
The reason the subsidiary location is required is to ensure continued access within the single market even after Great Britain leaves and is no longer a part of it.
Among the various factors insurance companies like the Lloyd’s of London marketplace have had to take into account are regulation, tax, proximity to their existing or sought-after clients. Moreover, it must also be an appropriate location for the staff members who will work there, including the proximity to good international schools, restaurants and other features that will make it enjoyable for the people and their families to live.