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 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%.
After a series of delays, Brexit happened at 23:00 GMT on 31 January 2020.
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.
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.
A term used by critics of Brexit to describe the prospect of the UK leaving the European Union with no deal at all.
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.
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.
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.
How rules and regulations could differ between the EU and the UK after Brexit.
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.
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.
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.
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.
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.
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.
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.
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.
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.
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.
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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CILA is one of the pre-eminent events in the annual 'Life' calendar. Due to COVID-19 we are running the programme as a series of webinars covering topics aimed at practicing life actuaries from life offices, consulting firms and other employers of actuaries and those who work in or advise on, the life assurance market in the UK and Europe.
Current Issues in Life Assurance - For annuity writers, a key challenge is the need to fund capital-consumptive new business strain (NBS) as a consequence of writing the business intended to fund future distributions. Reinsurance, investment strategy and capital provision all have roles to play which we will investigate in this webinar
Current Issues in Life Assurance – Mortality in 2020 is now dominated by one thing, although – in our future-focused world – the pandemic is just one of many mortality considerations. In this session, three well-regarded mortality/longevity specialists provide an overview of implications and impacts of COVID-19, recent and imminent CMI developments and more 'future focused' work in the MRSC
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Part of the Protection, Health and Care Conference 2020 webinar series
This session will provide an overview of the Population Health Management Working Party's research including defining impactability and impactability modelling, discussing some examples of specific modelling approaches, considering the practical challenges across the NHS as well as wider public perception and ethical issues.
Many actuaries consider career opportunities in the Finance and Investment practice area after having started off in more traditional actuarial roles such as valuations, capital management or pricing. This session is aimed at helping actuaries to better understand roles in Finance and Investment and how they can fine tune their skills to pursue such careers.
Due to COVID-19, we are running this programme via a series of webinars commencing 22nd July.
This webinar series will provide topical and practical updates and discussion on the latest thinking and innovations in mortality and longevity, and is designed to be very accessible to a broad range of experience.
Insurers are making increasing use of medical research to help with assumption, models and underwriting. Experienced mortality/ longevity specialists discuss the issues in the interpretation of medical research papers, using a range of case studies. The case studies will include COVID-19 points of current importance. Many of the concepts discussed (data bias, inference of causation) are also applicable to equivalent questions in 'big data' and advanced analytics.
Members of the Mortality Working Group of the IAA have analysed changes in mortality for about 30 causes of death and will discuss how causes of death are classified, and the problems of long-term data, appropriate metrics, including "years of life lost" (YLL), causes of death - a "measure of cohortness", the changes in dominant causes of death at older ages, and how can these types of studies enhance mortality forecasting.
Predictive risk assessment and risk stratification models based on postcode-level consumer classification are widely used for life insurance underwriting. However, these are socio-economic models not directly related to health information. Similar to precision medicine, precision life insurance should aim to tailor policy pricing/reserving to the individual health characteristics of each client.
The aim of this webinar is to provide an overview of research undertaken within the Data Science Working Party on applying machine learning methods for sentiment analysis and opinion mining of UK Twitter data relating to COVID-19.
This discussion, the fourth in the Extreme Mortality Events webinar series, will look at what poor model selection and calibration could look like – using inappropriate historical data; using incorrect 2020 mortality data; and inappropriate stochastic model recalibration (or lack thereof). Presented by Chair of the Life Board of the Institute and Faculty of Actuaries, Colin Dutkiewicz.
This webinar has been re-scheduled from its original date of the 1st July. Although ESG has many buyers across the asset allocation community, from pension funds to sovereign wealth funds, it still hasn’t found its place within the core asset management strategy desks where the money is actually invested. The problem as well as the opportunity is Fixed Income. Plenty of strategies exist for incorporating ESG within Equities, from screening, integration to a combination. ESG has picked up relatively quickly within Equities with rating,indices created using ESG factors. This talk will discuss how we price a quantifiable ESG credit risk premium and make it alpha worthy in a strategy.
Over the past decades, many countries have exhibited mortality rates approximately following a piecewise linear law. This is visible in the form of steady improvements over multiple years, followed by a rather abrupt trend change, and then again stable improvements according to the new trend.
Part of the Protection, Health and Care Conference 2020 webinar series
With the rising prevalence of dementia, how can we manage this risk effectively and can insurance do more? Matt Singleton, Ageing Lead at Swiss Re, will cover these topics and demonstrate how insurance could help people address their concerns.
Current Issues in Life Assurance – Join us for an exploration session on the use of data science in insurance companies today including how insurers are making sense of and using new data sources and technologies, exploration of practical applications of data science within actuarial work, benefits of data-driven decisions to solve business problems using the power of data and technology, and the role that actuaries can play to harness the benefits of data science.
Current Issues in Life Assurance
This talk will look at a range of such techniques (e.g. mass lapse risk transfer, contract boundaries, risk margin relief, non-standard longevity risk transfer) that have been applied or considered by UK and EU insurers, and the pros and cons of each.
Current Issues in Life Assurance.
The International Association of Insurance Supervisors announced on 14 November 2019 the adoption of v2.0 of the global Insurance Capital Standard (ICS) which will undergo confidential reporting for 5 years starting from 2020. This session will include specific experiences from Legal and General (L&G) as well as global industry perspectives from EY.
Current Issues in Life Assurance
This session will cover the PRA supervisory statement on financial impacts related to climate change, industry insights into PRA climate risk business plans, examples climate risk strategy setting out key workstreams and activity steps for successful execution, an overview of a climate risk strategy execution timeline and the future.
On 25 June the International Accounting Standards Board published Amendments to IFRS 17, the Insurance Contracts global accounting standard effective 1 January 2023.
Part of the Protection, Health and Care Conference 2020 webinar series
This session will cover how we have challenged conventional approaches to underwriting and risk selection in order to develop an approach that aligns current practices, customer and broader interests with robust risk assessment.
Part of the Protection, Health and Care Conference 2020 webinar series. Using new and unique research and data from the UK, US, Sweden and China, this presentation investigates how consumers use the internet through their insurance journey and analyzes the role culture and generation plays in their online behaviour. We use this research to show the online landscape for insurance sales in the UK and suggest ways to shape new products and effectively engage with the consumer who is buying them.
Chief Medical Officer (CMO) for Gen Re Life/Health Research and Development, Dr John O'Brien, will discuss the impacts of Gene Modification for life/health insurance.
Our presentation will examine the challenges arising in setting mortality improvement assumptions, exposing known but under-explored vulnerabilities of current practices.
As an industry, it has been important to be able to look to the future to identify the next quantifiable risk. In this session, I will explore some of the less tangible, but none-the-less concerning risks to future health, such as the health risks associated with exposure to pesticides, ingestion of plastic in the food chain, and the hazards of indoor air pollution through exposure to volatile organic compounds.
The working party will help the industry to update and enhance how potential risk from diabetes and excess mortality is considered, including the need to understand the underwriting implications as treatments improve, and potentially to develop new products that are tailored to those with diabetes.
This event is now fully booked. To join the wait list, please register here.
A Trusted Profession
Part of the Protection, Health and Care Conference 2020 webinar series. Modelling the structure and trends of cancer morbidity risk is important for pricing and reserving in related health insurance fields such as critical illness insurance and care provision. We model the dynamics of cancer incidence over time in different regions in England, using 1981-2016 ONS data. The modelling allows estimation of cancer rates at various age, year, gender and region levels, following a Bayesian setting to account for statistical uncertainty. Our analysis indicates significant regional variation in cancer incidence rates.
Part of the Protection, Health and Care Conference 2020 webinar series. In this talk we will outline the steps Aviva took in pulling together our first large-scale disclosures on the exposure of our business to climate change published in March 2019; in line with the recommendations of the Taskforce on Climate-related Financial Disclosures. After touching on why insurers have such an important role in climate change, we'll cover a brief “how-to” guide for those who have not yet embarked on thinking about these topics before giving a case study of how the learnings from a TCFD disclosure exercise can be applied to investment portfolios.
Part of the Protection, Health and Care Conference 2020 webinar series.
The insurance industry currently underwrites customers with diabetes based on a range of factors, medical expertise and various medical studies. The work undertaken by the Diabetes Working Party would help the industry to approach this using current research findings to update and enhance how potential risk from diabetes is considered. This includes the need to understand the underwriting implications as treatments improve, and potentially to develop new products that are tailored to those with diabetes. This webinar will present our latest findings in the management of this important chronic condition which will include research in collaboration with the ARC.