British regulators to cut red tape for insurers moving to UK

By Chris Vellacott

British financial regulators are cutting red tape for foreign insurers applying to set up in the UK as the government acts to boost the City of London as a driver of growth and jobs.

Spurred on by recent successes such as U.S. broking giant Aon moving its HQ to London last year, UK financial regulators have pledged to "streamline" authorisation for foreign insurers looking to set up in Britain.

"The Prudential Regulation Authority and the Financial Conduct Authority have committed to ensuring that the authorisation process for prospective insurers is as streamlined as possible," Britain's finance ministry said in an "action plan" for the insurance industry.

The UK government also said it would act to promote the UK insurance industry in key fast-growing economies such as Brazil and China, putting it at the centre of trade negotiations and sending senior officials around the world with trade delegations.

The government hopes planned cuts to corporation tax will help lure firms to Britain, as well as London's well established links to emerging markets in Africa, the Middle East and Asia.

Britain is already a hub for insurance with hundreds of firms concentrated in the City of London, home to the 325-year-old Lloyds underwriting market.

London's status was further raised by the relocation in 2012 of the world's biggest broker Aon Corp to London from Chicago, attracted by proximity to Lloyds and access to emerging markets.

The regulators' pledges accompanied the announcement by Britain's biggest insurers that they will invest 25 billion pounds ($41 billion) in transport and energy projects over the next five years, backing a government drive to shore up infrastructure.

Jonathan Howe, a UK insurance specialist at PricewaterhouseCoopers (PwC), called the government's commitment to promoting the sector "progressive, proactive and practical".

"It is very positive to see the government committing to its 'open for business' agenda ... The insurance industry is hugely important to the UK and one of our great success stories," he said.

Since the financial crisis, Britain's government has moved to promote non-banking sectors of the City of London such as insurance and fund management.

Source: Reuters