By John Smith • 18 September 2017 • 14:33
Nicky Morgan, Chair of UK Treasury Committee
CONSERVATIVE MP Nicky Morgan, Chairman of the UK Treasury Committee has written to the Chancellor regarding possible loss of pension payments and insurance for expatriates.
It appears that what are known as cross-border insurance policies may no longer be permitted following Brexit unless some form of agreement is reached between the UK and European Union.
In essence, a number of policies which run after March 2019 have been sold to customers under passporting arrangements which allow for the insurers to make payments into the EU but these arrangements will in theory be stopped post Brexit unless some form of agreement is reached.
Pensioners in particular should not immediately worry as it is believed that state and other pensions paid into UK accounts should be safe but there may be some difficulty in respect of private pensions paid in euros into EU accounts.
The same may be true for other insurance policies also written in the UK but covering properties, lives or other matters in Spain.
This is not some form of crafty trick by insurance companies but a situation which means that without some form of agreement, they will either have to withhold payment or risk breaking the law.
So far, the United Kingdom has indicated that part of the initial discussions involved cross-border sales of goods and materials but according to the Treasury Committee, both the UK and EU appear to have overlooked this form of sales.
As it could take anywhere from nine to 18 months for legislation to be put in place to allow these transfers or for British insurers to either set up subsidiaries abroad or transfer their existing portfolios to third parties, the problem is quite urgent.
In her letter to Chancellor, Philip Hammond, Miss Morgan said “The possibility that UK providers may not be legally able to pay out pensions or insurance contracts to citizens in the EU – including UK expats – is a stark example of the consequences of a ‘cliff edge’ Brexit.”
She went on to say that “It is therefore surprising that there have been no position papers from the [European] commission or the government proposing how it might be addressed.”
It is estimated that there may be several hundred thousand contracts which could be affected and therefore this intervention by the Treasury Committee is clearly very timely, especially considering that it could affect the British finance industry and a large number of expatriates.
Share this story
Subscribe to our Euro Weekly News alerts to get the latest stories into your inbox!
By signing up, you will create a Euro Weekly News account if you don’t already have one. Review our
Married to Ophelia in Gibraltar in 1978, John has spent much of his life travelling on security print and minting business and visited every continent except Antarctica.
Having retired several years ago, the couple moved to their house in Estepona and John became a regular news writer for the EWN Media Group taking particular interest in Finance, Gibraltar and Costa del Sol Social Scene.
Share your story with us by emailing [email protected], by calling +34 951 38 61 61 or by messaging our Facebook page www.facebook.com/EuroWeeklyNews
Has nobody ever heard of sending euros from their UK bank account to their Spanish account?
You couldn’t make this drivel up!
If UK Insurance Companies make pension payments in Ã¢ÂÂ¬uros, open a Ã¢ÂÂ¬uro account with your English Bank, then set up a transfer of the monies to your European residential account.
Your email address will not be published. Required fields are marked *
Downlaod our media pack in either English or Spanish.