UK insurer Hiscox has announced it will set up a new European subsidiary in Luxembourg as it prepares for life after Brexit.
Hiscox, which employs 1,200 people in the UK, considered setting up its subsidiary in Malta, but in a statement on Tuesday said that Luxembourg was selected for its "pro-business position, strong financial services experience and well-respected regulator”. It also said that it was close to many of its existing major markets.
The company said that all of its European business will be written though its new subsidiary on the continent. A new team, covering compliance, risk and internal audit, will be recruited.
Brexit is likely to lead to the loss of so-called passporting rights which allow financial services firms to operate all over the continent whilst being regulated by authorities in one member state.
Insurer Lloyd’s of London, last month, chose Brussels as its new continental base.
Beyond insurers, JP Morgan last week confirmed it will move hundreds of banking jobs from the London to the continent. Daniel Pinto, the firm’s head of investment baking said JPMorgan cannot afford to wait for confirmation on how the industry will be regulated once the UK officially leaves the EU.
Goldman Sachs Europe chief executive, Richard Gnodde, also confirmed in March that the bank will relocate hundreds of staff out of London before any Brexit deal is struck and said it had already begun implementing those plans.
Back in January, Stuart Gulliver, the chief executive of HSBC, said that staff generating about 20 per cent of its London investment-banking revenue may move to Paris. “Activities specifically covered by EU legislation will move,” Mr Gulliver said.
Prior to the June referendum last year Robert Hiscox, who chaired the insurer for more than 40 years until 2013, accused former Prime Minister David Cameron's Government of disseminating pro-EU "illegal propaganda".
"All the experts coming out for Remain are all part of the elite, from Goldman Sachs downwards, they've all bought into it, it's for their own self-interest,” he said last year.
