UK ILS framework set to be in force in autumn

The UK’s economic secretary to the Treasury, Simon Barclay said that the regulation to introduce insurance linked securities (ILS) in the UK will be laid in Parliament before the summer recess and may be in force in autumn.

Barclay included this timeframe in a letter to the chairman of the London Market Group, Nicolas Aubert.

The UK’s chancellor of the exchequer, Philip Hammond, had included in his past Autumn Statement a reference to the government’s plan to make London an international centre for ILS.

The UK must innovate if London is to retain its uniquely important position in the market, Barclay explained in the June 26 dated letter. Alternative risk transfer techniques expand the capacity of the insurance and reinsurance markets, enabling risk to be managed more efficiently and effectively for businesses and consumers, he wrote.

“With the right regulatory framework, I believe the UK can make a major contribution to the development and growth of alternative risk transfer. That is good news for the UK and for the global economy,” Barclay said.

The regulations are now being finalised so they can be laid in Parliament before the summer recess, with a view to the regime coming into force in the autumn of this year.

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