The UK’s new ‘city’ minister has told the Association of British Insurers (ABI) that he is the right man for the job, and has confirmed the government’s commitment to launching an insurance-linked securities (ILS) regulatory scheme.
The Economic Secretary to the Treasury, Stephen Barclay, told the ABI that having worked in both the insurance and banking sectors, as well as at the City regulator, he would “bring that industry focus to bear in discussions within Whitehall and beyond.”
Barclay did his best to reassure insurers that they will still be able to bring in talent from abroad despite Brexit, and said the British people understand the importance of businesses being able to access global talent.
“The concerns on immigration expressed during last year’s referendum were not about insurers bringing in the skills they need to keep their businesses at the cutting edge. Rather it focused on those who come, primarily to areas like my constituency, at a pace and scale not reflected in local services,” he said.
Earlier this week, Barclay wrote to the London Market Group (LMG) confirming the Treasury’s “intention to complete the project” of bringing in an ILS regime. In his speech, the minister stressed that the UK would press on with its plans.
“Up to now, without that kind of regulatory framework in place, London has been held back from becoming a leader in ILS, despite all the expertise we have to offer in the field of alternative risk transfer,” he said.
However that is all set to change: Barclay said he plans to place regulations to implement the new framework before Parliament imminently, to help London become global leaders in the field.
The insurance industry reacted positively to the news that the government is committed to the ILS plans. In response to the LMG letter, Malcolm Newman, chairman of the group’s ILS Taskforce and MD of SCOR’s EMEA hub, commented: “The London Market Group is delighted that the new ministerial team remains fully committed to the ILS initiative and welcomes confirmation that the legislation will be on the statute books this year.”
He went on to say: “This is a great example of London finding ways to innovate and reinvigorate its position as a global leader in risk transfer. We hope this partnership with Government sets a strong precedent for other initiatives and growing its share of the global market.”
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