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Brexit: jargon buster

A slew of new terms and phrases have come in to common usage as a result of the jargon created by the Brexit process. Our Brexit jargon buster aims to explain some of the most commonly used terms.

Australia-style deal

Australia negotiated a “partnership” with the EU in 2008, which streamlines systems to make trade smoother, but the two parties still trade under World Trade Organisation (WTO) rules. If the UK ended up with an Australia-style agreement it would involve adopting WTO trade terms. Tariffs would be applied to UK goods and services being exported to Europe, at an average rate of 5.1%.

Brexit Day

After a series of delays, Brexit happened at 23:00 GMT on 31 January 2020.

Canada model

Canada has a free trade deal with the EU known as the Comprehensive Economic and Trade Agreement (CETA). Under the deal, most imported goods are not taxed, although there are some additional customs checks. There are some limits, or quotas, on the amount of certain food products like meat and cereals that can be imported. Services, like banking, are much more restricted. Canada does not contribute to the EU budget and the principle of free movement does not apply, so Canadians are not free to live and work in the EU.

Canada plus

Some people in favour of leaving the EU have campaigned for the Canada plus or Canada plus plus model. The idea is modelled on the trade deal Canada has with the EU. Under the Canada deal, most imported goods are not taxed, although there are some additional customs checks. There are some limits, or quotas, on the amount of certain food products like meat and cereals that can be imported. Services, like banking, are much more restricted. Supporters of Canada plus would want all the benefits of the Canada deal, plus greater access to the EU for the UK's financial institutions and other enhancements.

Cliff edge

A term used by critics of Brexit to describe the prospect of the UK leaving the European Union with no deal at all.

Customs Plan

The Prime Minister’s Brexit deal includes a customs plan. Under it, some goods entering Northern Ireland from GB will have to pay EU import taxes (known as tariffs). The tax will only have to be paid on goods which are deemed "at risk" of entering the Republic of Ireland. The list of "at risk" goods will be decided at a later date. If goods subsequently remain in Northern Ireland (ie do not travel to the Republic of Ireland), companies will be able to apply for a refund on the tax they've paid.

Customs territory

A geographic area, covering two or more countries, which share the same custom regulations. Under Boris Johnson's Brexit deal, Northern Ireland and Great Britain will remain part of the same customs territory - although Northern Ireland will need to continue to follow EU custom rules.

Customs union

The EU customs union is an agreement between EU countries not to charge taxes called tariffs on things coming from other EU countries, and to charge the same tariffs as each other on things coming from outside the EU.

Divergence

How rules and regulations could differ between the EU and the UK after Brexit.

Divorce Bill

The money the UK agrees to pay to the EU as part of a Brexit deal. It is expected to be about £30bn, to be paid over a number of years. It was based on UK's share of EU budgets up to the end of 2020 as well as continuing liabilities such as EU civil servants' pensions. Some of that money has been paid as part of the UK's normal membership contributions already.

Equivalence (also known as alignment)

How rules and regulations could remain the same or similar between the EU and the UK after Brexit.

European Economic Area (EEA)

An area covering the 27 European Union countries plus Norway, Iceland and Liechtenstein, which enables those three countries to be part of the EU's single market. They abide by the rules of the EU single market and its freedom of movement of people, goods, services and money. But Norway, Liechtenstein and Iceland are not part of the EU's Common Agricultural or Fisheries policies and they do not have a common foreign and security policy.

Free trade agreement

A deal between countries to reduce, but not necessarily eliminate, trade barriers. These barriers include import or export taxes (tariffs), quotas or licences that limit imports, and differing regulations on things such as safety or hygiene or labelling. The aim is increase trade in goods but also services.

Frictionless trade

Trying to do business between the UK and the European Union with the minimum of tariffs, quotas, customs checks and other obstructions.

Level playing field

A set of rules that EU countries need to follow when it comes to areas such as: workers' rights, state aid and competition policy. The rules are meant to ensure that no EU country has an unfair advantage over another. However, Mr Johnson wants to have the option to diverge from all these rules in the future. Free trade agreements between non-EU countries also contain level playing field provisions.

No deal

A no-deal Brexit would mean the UK leaving the European Union and cutting ties immediately, with no agreement in place. However, the UK left on 31 January with the withdrawal deal negotiated by the Prime Minister. A transition period started on the next day, ending on December 31 2020. If no UK-EU trade deal is ready, the UK would then have to follow World Trade Organization (WTO) rules to trade with the EU and other countries, until a deal is ready to be implemented.

Passporting

The arrangement under which British companies and foreign companies with bases in the UK are allowed to sell financial services across the European Union with no regulatory barriers.

Political declaration

Document which sets out proposals for how the UK's long term future relationship with the EU will work after Brexit. Unlike the withdrawal agreement, the political declaration is not legally binding - it sets out the hopes of both sides for the future on things like trade.

Single Market

A system that enables goods, services, people and capital (money) to move between all 27 EU member states, as well as Iceland, Norway, Liechtenstein and Switzerland. Countries in the single market apply many common rules and standards.

Settled status

EU citizens and their families who have been living in the UK for five years can apply for "settled status", which allows them to stay in the UK for as long as they wish. Any child born in the UK to a mother with settled status will automatically become a British citizen. Settled status means you can work in the UK, use the NHS, have access to pensions and benefits and travel in and out of the UK. Applications from people with serious criminal convictions, or where there are other security concerns, can be rejected.

Tariff

A tax or duty to be paid on goods being imported or, very occasionally, exported.

Tariff free trade

Trade without any taxes or duties to pay when goods are imported or exported.

Transition period

The transition period is intended to allow time for the UK and EU to agree their future relationship. The UK will have no say in the making of new EU laws during the transition process but will have to follow all EU rules for the whole of the period, including freedom of movement. The transition is due to last until 31 December 2020 and could be extended by up to two years if both the UK and EU wanted to. The UK Prime Minister has ruled out any extension to the transition.

TTIP

Transatlantic Trade and Investment Partnership: a proposed trade agreement between the European Union and the United States. The deal was put on hold by the US shortly after the election of Donald Trump as US President.

WTO Rules

If countries do not have free-trade agreements, they usually trade with each other under rules set by the World Trade Organization (WTO). Each country sets tariff – or taxes – on goods entering their country. For example, cars passing from non-EU countries to the EU are charged at 10% of their value. If the UK chooses to put no tariffs on goods from the EU, it must also have no tariffs on goods from every WTO member.

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Events calendar

  • Spaces available

    Due to the COVID-19, we will be running this programme via a series of webinars commencing 22 April.  

    CIGI is a well-established seminar designed to increase awareness and encourage discussion on a variety of topical issues across the general insurance industry. 

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    Pressure on organisations to address climate change risks is intensifying. But what does this really mean for insurers? In this session Adhiraj Maitra and Gareth Sutcliffe will look at the why, the what and the how of this risk through a number of different lenses including regulatory, principle and resilience.

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    There have been a number of events across the financial markets where particular services have fallen below customer expectations.  These have included inability to receive or make payments or or the inability to check your own status or access services.  In an increasingly interconnected world the causes of this are often complex and hard to spot in advance, but can be a major impact to the reputations of firms.

  • CIGI Webinar - Are you Vulnerable ?

    Webinar
    27 April 2020

    Spaces available

    With ever increasing focus from the FCA on pricing practices and the relationship between insurers and their customers, it is critical to ensure appropriate controls are in place. This presentation summarises the latest developments in the market and showcases practical approaches to mitigate the risk of poor customer outcomes in pricing, with a particular focus on protecting vulnerable customers.’

  • Spaces available

    This webinar provides an update on renewal pricing outcomes for Property and Casualty markets at the latest 1/1 reinsurance renewals with the focus being on capacity availability and price drivers.  These issues include, but are not limited to, the cat bond market, wider trends in claims outcomes, trends in Casualty RI space that affect pricing such as social inflation, yield curve, and the reserving cycle.

  • Spaces available

    The Ogden Discount Rate shock of 2017 brought about a period of profound uncertainty to General Insurance market.  GI Actuaries' first task was to estimate the impact of the Ogden shocks, particularly to reserving and reinsurance pricing.  Their second was to navigate a period of framework uncertainty, maintaining an agility in actuarial modelling as the Civil Liability Bill took shape. 

  • Spaces available

    Model validation should not be a tick box exercise. It has all the right ingredients to be a value adding exercise that can help senior management understand what really drives the business from a risk and capital perspective. Model validation can be a stressful, bloated process - and may not be as value adding as it could be. 

  • Spaces available

    The FCA’s interim report into general insurance pricing practices has brought into focus a number of market wide issues including:

    Price walking • Poor governance • Higher prices for potentially vulnerable customers • Higher prices for less aware customers

  • CANCELLED The Global Actuarial Profession

    Staple Inn Hall, High Holborn, London, WC1V 7QJ
    30 April 2020

    Spaces available

    We are sorry that this event has been cancelled.

    The IFoA's policy regarding COVID-19 is designed to safeguard the well-being of members and employees. As stated within the policy, the IFoA is reviewing its events programme on a case-by-case basis.

  • Spaces available

    The IFRS 17 Working Party have been producing a number of deep dive papers, these include topics such as risk adjustment, impact of disclosures on how uncertainty is perceived, deferring acquisition costs over renewals, PAA eligibility and more. 

  • SIAS Event: Cyber Insurance

    Staple Inn Hall, High Holborn, London, WC1V 7QJ
    4 May 2020

    Spaces available

    The talk will cover:
    • Why cyber security is regarded as the top threat to businesses (Allianz Risk Barometer 2019)
    • What is causing the shift in threat landscape
    • Who is attacking, why, and how we can stop them
    • Customer impressions of cyber security and how you can help them
    • Threats to evaluating insurable losses and responding to claims
    • How cyber insurance policies have evolved, and need to continue to do so
    • Can and should you recover ransoms under cyber insurance?
    • What is the future for cyber risk?

  • KSS event: Technology: A red-eyed Terminator or an actuary’s best friend?

     Hymans Robertson, Exchange Place 1, 1 Semple Street, Edinburgh, EH3 8BL
    4 May 2020

    Spaces available

    Despite long-running concerns that innovation could lead to widespread redundancy, technology has enabled greater productivity, created higher-value jobs and spurred us on to new heights. With artificial intelligence increasingly automating work undertaken by professionals, I look at the prospects for the actuarial profession in the era of unprecedented technological innovation.

  • Finance and Investment Conference 2020

    Royal College of Physicians, 11 St Andrews Pl, London NW1 4LE
    05-05 May 2020
    Spaces available

    Due to COVID-19, we are running this programme via a series of webinars commencing 5 May.

    The environmental, social and governance (ESG) space is growing rapidly and increasingly moving centre stage. In many cases, it is now an essential part of policy and central to the way stakeholders make decisions for the long term to ensure retention of clients, manage risk better, and ensure more economically efficient and sustainable investment returns.

    ESG factors cover a wide range of areas reflecting how vital consideration of these factors are part of wider systemic risks.

    The IFoA’s policy regarding Coronavirus is designed to safeguard the well being of those who attend IFoA events. Find out more. 

  • Professional Skills Training - Edinburgh (19 May 2020)

    IFoA (Edinburgh), Level 2, Exchange Crescent 7 Conference Square Edinburgh EH3 8RA
    19 May 2020

    Spaces available

    A Trusted Profession

    A 2 hour CPD event designed to meet the IFoA’s Stage 3 Professional Skills Training under the IFoA’s CPD Scheme 2019/2020This session is suitable for actuaries working in any area (i.e. it is not specifically aimed at Pensions, GI or any other technical discipline) and is interactive, so you should come along prepared to take part in the discussions.

  • Professional Skills Training - London (19 May 2020)

    Staple Inn, High Holborn, London WC1V 7QJ         
    19 May 2020

    Spaces available

    A Trusted Profession

    A 2 hour CPD event designed to meet the IFoA’s Stage 3 Professional Skills Training under the IFoA’s CPD Scheme 2019/2020This session is suitable for actuaries working in any area (i.e. it is not specifically aimed at Pensions, GI or any other technical discipline) and is interactive, so you should come along prepared to take part in the discussions.

  • CILA 2020

    Royal College of Physicians, 11 St Andrews Pl, London NW1 4LE
    20 May 2020

    Spaces available

    Due to COVID-19 this event has been postponed until later in the year. A new date will be announced soon.

    Thank you for your patience and understanding.

  • Protection, Health and Care Conference 2020

    The Grand Brighton, 97-99 Kings Rd, Brighton BN1 2FW
    02-03 June 2020
    Spaces available

    The Protection, Health and Care Conference is an annual conference aimed at all insurance professionals with a passion for harnessing insurance risk in their organisations.

  • Spaces available

    How we relate to others at work, whether they are colleagues, clients, prospective clients or other business contacts is key to individual career progression and business performance. People buy people , so considering what we are known for and how to be positively memorable are vital. This session looks at the importance of professional relationships, the psychology of personal image and impact and the three personal impact 'tools' which affect what people say about us when we're not in the room.

  • Mortality and Longevity 2020

    1 Birdcage Walk, Westminster, London SW1H 9JJ
    08-08 June 2020
    Spaces available

    This highly regarded seminar will provide topical and practical updates and discussion on the latest thinking and innovations in mortality and longevity.  The program is designed for life, pensions and health and care actuaries, academics, researchers, underwriters and related practitioners eager to learn about the latest developments in mortality and longevity.  The sessions are designed to be very accessible to a broad range of exp

  • Professional Skills Training - London (10 June 2020)

    Staple Inn, High Holborn, London WC1V 7QJ       
    10 June 2020

    Spaces available

    A Trusted Profession

    A 2 hour CPD event designed to meet the IFoA’s Stage 3 Professional Skills Training under the IFoA’s CPD Scheme 2019/2020This session is suitable for actuaries working in any area (i.e. it is not specifically aimed at Pensions, GI or any other technical discipline) and is interactive, so you should come along prepared to take part in the discussions.

  • Professional Skills Training - Edinburgh (17 June 2020)

    IFoA (Edinburgh), Level 2, Exchange Crescent 7 Conference Square Edinburgh EH3 8RA
    17 June 2020

    Spaces available

    A Trusted Profession

    A 2 hour CPD event designed to meet the IFoA’s Stage 3 Professional Skills Training under the IFoA’s CPD Scheme 2019/2020This session is suitable for actuaries working in any area (i.e. it is not specifically aimed at Pensions, GI or any other technical discipline) and is interactive, so you should come along prepared to take part in the discussions.

  • Professional Skills Training - London (18 June 2020)

    Staple Inn, High Holborn, London WC1V 7QJ   
    18 June 2020

    Spaces available

    A Trusted Profession

    A 2 hour CPD event designed to meet the IFoA’s Stage 3 Professional Skills Training under the IFoA’s CPD Scheme 2019/2020This session is suitable for actuaries working in any area (i.e. it is not specifically aimed at Pensions, GI or any other technical discipline) and is interactive, so you should come along prepared to take part in the discussions.

  • Pensions Conference 2020

    Renaissance Manchester City Centre Hotel, Blackfriars Street, Manchester,M3 2EQ
    18-19 June 2020
    Spaces available

    Join us as this year’s conference that will focus on topics including  funding and savings, pension law current issues, ESG, the end game and transferring risk, investment issues, data visualisation and data science.

  • IFoA Asia Conference 2020, Kuala Lumpur

    CCEC Nexus, 7, Jalan Kerinchi, Bangsar South, 59200 Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur, Malaysia
    24-25 June 2020
    Spaces available

    This event has been postponed. A new date will be announced.

    The IFoA's policy regarding COVID-19 is designed to safeguard the well-being of members and employees. As stated within the policy, the IFoA is reviewing its events programme on a case-by-case basis.

    To this end the IFoA and their strategic partner, the AIR, have taken the decision to postpone this year's Asia Conference. A new date will be announced pending further reviews over the following months.