Welcome to Insurance Briefing - a fortnightly round-up of insurance legal and business developments published on Out-Law - with analysis and commentary from the insurance team at Pinsent Masons.
Our five topics in focus this fortnight are:
UK's Insurance Linked Securities Framework set to be in force by Year End
Regulations which will establish a UK framework governing the tax and regulatory treatment of insurance linked securities (ILS) have been laid before parliament. The regulations are now final subject to their passage through parliament, which implies that the UK's ILS regime will be in force in time for the 2018 renewal season. The London Market Group (LMG) said that it was "delighted" that the regulations had been introduced to parliament, and that it hoped that they would be "debated and approved" in the next few weeks.
Engage with government or risk being sidelined, expert warns businesses
ANALYSIS: Business sectors may find themselves out in the cold if they fail to seize the opportunity to communicate their concerns and outlines their aspirations for a post-Brexit UK to the government. Some industries may take the view that the shape of the UK's future relationship with the EU is still too uncertain for them to justify lobbying the government, but this is not the case. Make no mistake, the next few months and years will consist of the most gigantic horse trade where the future of a large number of economic sectors and industries will be thrown in the melting pot. There will be winners and losers out of this process, and industries which have acted now and managed to persuade the government about a particular line to take in the negotiations are likely to get a better outcome than those which have sat in silence.
VAT and pension funds: withdrawal of VAT exemption for fund management services provided by insurers
Whether management services provided to pension funds are taxable or exempt for VAT purposes has been in dispute for around 10 years. The CJEU has considered the issue but United Biscuits has launched a challenge in the UK courts on the basis that HMRC adopts a different treatment for funds managed by insurers. HMRC has responded by announcing the withdrawal of its long established policy of allowing exemption for pension fund management services provided by insurers. This will mean the addition of VAT to previously exempt management, increasing costs for many pension funds. In addition, a significant VAT change must be implemented within three months.
UK government pushes for compliance with Modern Slavery Act
The UK government has amended its guidance over how companies and other organisations should show they have taken steps to ensure modern slavery is not taking place in their business and supply chains. In updated guidance published this month the Home Office set out to encourage companies to comply with the requirement in the Modern Slavery Act 2015 to produce a statement setting out their efforts to make sure they are compliant with the 'Transparency in Supply Chains' provision of the legislation.
From HIM to The Great Flood of 2050 - act of God or human action?
(Opinion piece in Insurance Day by Nick Bradley (Login Required)): It may only be a matter of time before it will be possible to establish a link between extreme weather events and human activities, and from there to identifiable and actionable damage.
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