North P&I Club creates Brexit unit in Ireland
The board of directors of North and Sunderland Marine has agreed that a subsidiary insurance company should be established in Ireland to underwrite all future European Economic Area (EEA) business with effect from Feb. 20, 2019.
The move follows the result of the UK referendum on membership of the EU in July 2016. North and Sunderland Marine currently rely on EU passporting rights to insure risks located in the EEA. Details of the future UK/EU trading relationship and its implementation are currently unknown and subject to ongoing negotiations between the EU and the UK government. However, expectation is that North and Sunderland Marine’s existing passporting rights will ultimately be lost either immediately upon termination of the UK’s EU membership or at the end of any agreed transition period, according to a statement.
North P&I Club is a global marine insurer providing protection and indemnity (P&I), freight, demurrage and defence (FD&D), war risks and ancillary insurance to 140 million gross tonnage (GT) of owned tonnage. Through its guaranteed subsidiary Sunderland Marine, North is also an insurer of fishing vessels, small craft and aquaculture risks.
The decision to locate the subsidiary in Ireland was partially driven by the fact that regulatory, legal and taxation framework in Ireland is similar to the UK, where North is an experienced operator. Ireland also offered a “mature regulatory system with substantial experience in the supervision of Solvency II insurance companies, a strong talent pool within the financial services sector, easy travel connections from Newcastle as well as the ability to conduct business in English, according to the statement.
The structure and local operations of the Irish subsidiary are subject to on-going investigation and a future announcement will be made in respect of these issues during implementation phase of contingency plans, which is expected to commence during the first quarter of 2018, the statement noted.