American International Group Inc. plans to locate an insurance company in Luxembourg to ensure continued smooth operation of its business across the European Economic Area (EEA) and Switzerland once the United Kingdom leaves the European Union.
From 2019, AIG proposes to have two AIG subsidiary insurance companies in Europe – one in the UK to write UK business and one in Luxembourg to write EEA and Swiss business, which will have branches across the EEA and Switzerland, AIG said in a statement
AIG currently writes business in Europe from a single insurance company based in the UK, AIG Europe Ltd., which has branches across the EEA and Switzerland.
The UK is AIG’s largest single operation in Europe, the company said, noting that AIG will continue to support its European operations from the UK. It described the UK as a core market in which it will “continue to invest and grow.”
“This is a decisive move that ensures AIG is positioned for whatever form the UK’s exit from the EU ultimately takes,” said Anthony Baldwin, chief executive of AIG Europe.
“AIG sees opportunity in the ongoing resilience of the UK insurance market. At the same time, we are ensuring that our clients and partners experience no disruption from the UK’s EU exit. Our Luxembourg company will be complementary to our existing structure and will be part of our single European module,” he added.
“Luxembourg, a founding member of the European Union, offers us a secure location in a stable economy with an experienced and well-respected regulator in continental Europe close to many of our major markets.”
The proposed restructure is expected to complete in the first quarter of 2019, subject to regulatory approval.
Source: American International Group
[Editor’s note: Lloyd’s of London plans to make an announcement on its new European subsidiary by the middle of April at the latest in preparation for Britain’s exit from the European Union. Lloyd’s of London insurers Beazley and Hiscox also are eyeing EU-based insurance subsidiaries, to name a few that are considering such a move.]