American International Group (AIG) has announced the authorisation of two new insurers in the UK and Luxembourg, and has outlined plans to transfer all business to the new entities ahead of the UK’s departure from the European Union (EU) in March, 2019.
AIG’s restructure involves the transfer of AIG Europe Limited’s existing re/insurance business to the new UK and European companies, and the merger of its existing carrier into the new European company.
The transfer of business is expected to take effect from 1st December 2018, at which time the new companies will also begin writing business.
The move is expected to provide AIG’s clients with certainty of uninterrupted re/insurance coverage as the company adapts its business model to the uncertainties posed by the future relationship between the UK and EU.
Anthony Baldwin, Chief Executive Officer (CEO) of AIG Europe Limited said: “We set a number of guiding principles from the very start as to how AIG would address Brexit. First amongst these was minimising disruption to clients.
“The great advantage of the restructuring route we have chosen is that it will give clients certainty that whatever the other unknowns of Brexit for their businesses, their European insurance coverage has been Brexit-proofed.
“We have already established a platform in Europe for writing future new business and renewals, and by transferring our existing business, AIG will remove uncertainty for clients, including not being reliant on the development of a grandfathering regime for existing contracts.”
The new consolidated European company, AIG Europe S.A., is expected to have branches across the European Economic Area (EEA) and Switzerland.
In addition to establishing and receiving authorisation for the new UK company, AIG has obtained approval from the High Court of England and Wales to begin notifying policyholders regarding the transfer of re/insurance portfolios.
AIG are not the first major re/insurer to begin relocating their business in preparation for Brexit, with many companies electing to transfer their UK business to countries like Luxembourg and Ireland to ensure post-Brexit continuity.
