Fears That X Will Put Market on The Spot

The UK will go to the polls today and the insurance sector will await the outcome with bated breath.

Three years ago the Insurance market went to bed with the result of the Brexit referendum securely predicted to be a resounding remain. It awoke to the sobering news that Brexit was on.

Cue three years of uncertainty culminating in UK prime Minister Boris Johnson heading for the ballot box in an effort to break the deadlock.

However, a strong Conservative party lead has been steadily evaporating to the point where a hung parliament cannot be ruled out and with it a coalition government led by Labour leader Jeremy Corbyn.

“It is a case of the lesser of two evils,” said one marine underwriter. “Boris Johnson will look to encourage business but it comes at the price that a Conservative government will mean Brexit in some shape and with it several years of uncertainty while the trade deal is thrashed out.”

He added: “A Labour government is likely to stop Brexit but it is clear that their spending plans will require a higher corporate tax burden and Jeremy Corbyn has made it painfully clear he wants to tax higher earners.”

Brokers have shared that pessimistic view.

“It is not an election that the market is looking forward to,” said one Lloyd’s broker. “If Brexit could be a nightmare, a labour government definitely will be. When the referendum happened the market was disappointed as it was not the result that the industry wanted.

“However, at the last election [2017] there were several senior figures in this market that jokingly said if Jeremy Corbyn got elected they would leave the country. They are not laughing now.”