The Treasury Committee has published a letter written to the Chancellor of the Exchequer highlighting the problem with insurance contracts sold under passporting arrangements with a duration beyond 29 March 2019.
The Chair of the Treasury Committee explains that without further action, insurers will lose the right to service these contracts and there may be insufficient time to effect a Part VII transfer to deal with the problem.
The letter provides the example of UK expats living in the EEA and UK residents who have pensions with EEA-based providers who may face difficulties in receiving their pensions.
The Treasury Committee is seeking answers to the following questions:
- Does the Treasury consider that the problem set out above poses risks to a smooth and orderly exit, and does it therefore consider it to be a matter for the first phase of the Article 50 negotiations?
- What proposals are being considered to preserve stability and certainty in respect of insurance contracts that straddle ‘Brexit day’? In particular, does the Treasury wish to see arrangements that allow contracts written before ‘Brexit day’ to retain the same regulatory treatment for their duration?
- Does the Government intend to publish a position paper on this question?