The Association of British Insurers (ABI) has urged the government to agree a Brexit deal “as a matter of urgency” in response to its no-deal guidance paper for the banking, insurance and other financial sectors.

Highlighting that leaving the EU without a deal would cause “major inconvenience” to millions of pensioners, ABI director of regulation Hugh Savill said: “Today’s paper emphasises the risk of insurers not being able to make payments to customers based in the EU after the end of March next year.

“Obviously insurers want to meet their commitments to their customers, but this problem has the potential to affect millions of insurance customers, including UK pensioners overseas. It can be fixed by co-operation between the UK and EU regulators – if the EU authorities wish to do so. Insurers have of course been making contingency plans for their own operations for many months now, but this contract issue is not one that insurers themselves can fix.”

However, there is “ nothing that will take the financial services industry by surprise in today’s Brexit papers”, EY government financial services leader Andrew Pilgrim commented.

“While today’s papers reiterate that the UK government is doing all it can to maintain continuity in that scenario, there is a limit to what they can promise unilaterally. Whether there would be similar flexibility from the EU is likely to remain unclear for some time. Until then uncertainty remains the word of the moment, “ he added.

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