Insurance Policy: Gibraltar’s Ties Run Deep With UK Sector

Historically, Gibraltar has always demonstrated a deep commitment to an industry-first approach when it comes to the regulation of business and financial services — and the insurance sector is no exception. In 2018 alone, Gibraltar’s 45 licensed insurers recorded gross premium income amounting to some £5bn. 

Through our long-standing relationship with the United Kingdom, Gibraltar is in a unique position to offer insurance firms based here the opportunity to reap the benefits of our strong association with the UK market. 92% of Gibraltar’s financial services business is with the UK and approximately one in five UK motor insurance policies provided by Gibraltar-based insurers. These companies make up a significant part of the trade with our British counterparts adding to the competitiveness and choice available in this sector in the UK Market — a testament to the strong collaborative relationship Gibraltar has with the UK insurance sector. 

Having been at the forefront of government and industry-led discussions for a number of years, it is easy to see why insurance companies seeking to gain a foothold in the UK choose to do business from Gibraltar. Firstly, we have a robust insurance ecosystem underpinned by Solvency II regulation, as well as unique passporting rights into the UK, a new, easy to navigate regulation process as set out in Gibraltar’s new Financial Services Act, and high levels of consumer benefits and protection. 

A robust insurance ecosystem 

Through sector-specific regulation, that supports the growth of insurance services such as motor insurance, life insurance, insurance mediation, insurance linked securities (ILS), and insurtech, Gibraltar has successfully built a comprehensive and robust insurance ecosystem. Since the turn of the millennium our insurance industry has more than tripled, growing from 13 to 45 licensed insurers. Together, we have worked to make Gibraltar one of the best places for insurance companies to do business. 

Unique passporting rights into the UK post-Brexit

Gibraltar has a unique relationship with the United Kingdom through passporting rights, which allows companies to passport into the UK from Gibraltar – a process that will remain intact post-Brexit. These passporting rights give insurance companies in Gibraltar unique access to the UK market. When combined with the ability to gain swift access to Gibraltar’s independent financial services regulator, the GFSC, our insurance proposition is extremely compelling. 

A new, easy to navigate financial regulatory system

In January 2020, the Government of Gibraltar’s Financial Services Act came into effect. This new legislation brings a harmonised approach to our financial services regulatory system, making it easier for those who engage with it to navigate. 

High levels of consumer benefits and protection

More than 20% of UK motor insurance policies are provided by Gibraltar-based companies, whose policies bring significant benefits to UK consumers including increased choice and competition. In addition, UK consumers receive the same high levels of consumer protection that apply to a motor insurance policy from a UK insurer, thanks to the UK’s Financial Services Compensation Scheme (“FSCS”). Gibraltar insurers contribute on exactly the same basis as UK insurers to the UK’s FSCS.  

In 2020, we are introducing changes to our legislation and regulations aimed at attracting more Managing General Agents (“MGAs”) to establish in Gibraltar. Just like insurers, MGAs benefit from Gibraltar’s unique passporting rights into the UK. We believe these changes will be of great interest to a broad range of MGAs. For example, for insurtechs whose technology is ready to become operational a Gibraltar MGA offers speed to market, a robust regulatory regime and close proximity to Gibraltar’s vibrant Fintech Hub. 

Gibraltar is committed to innovating and supporting the companies that choose to do business here. Our commitment to a modern regulatory system and the emerging technology industry is evident through our support of the gaming industry, the insurance industry, and more recently, Distributed Ledger Technology (DLT). 

We look forward to continuing to support the insurance-focused companies already based here, and to welcoming new businesses who seek to avail of all Gibraltar has to offer. We are open for business.