Gibraltar’s insurance sector has a significant impact on the entire UK industry but its extent is often unwisely overlooked, according to financial services research and insight firm Verdict Financial.
The company’s latest report said the Gibraltarian insurance industry accounted for around £2.6 billion in UK motor insurance (commercial and personal lines) and about £3.3 billion across non-life general insurance.
Verdict Financial said insurers should be alert to the dynamics within Gibraltar’s insurance market, which is facing turbulent times as evidenced by strong growth for some firms and the collapse of one company.
“The fact that Gibraltar represents almost 20% of the UK’s car insurance market highlights the need for UK insurers to understand the dynamics of the Gibraltar space and the direction in which it is heading,” said Stewart McEwan, senior analyst at Verdict Financial.
McEwan said some of the fastest growing motor insurance brands in the UK are underwriting from Gibraltar. However, the latest insurer to announce insolvency – Enterprise – is also from the territory.
“The range of Gibraltar insurers’ performance, and the outcomes arising from elements at play within Gibraltar, will be most keenly felt in the UK’s niche markets, where the comparative influence of Gibraltar-based businesses is strongest,” McEwan said.
“The combination of the introduction of Solvency II to Gibraltar for small, specialist players, and the potential impact of Brexit, could mean a tighter, consolidated, possibly more robust market over the next few years.”
Third of insolvent insurer’s clients still without cover
14,000 customers to get refund as Enterprise Insurance shuts down