The vote by the British public to leave the European Union has sparked considerable confusion in the region’s financial services industry. Executives at insurers operating in the UK and EU will need to display strong leadership to counter uncertainty among their employees and customers.
“If you can keep your head when all about you are losing theirs…” The words of British poet Rudyard Kipling seem especially apt as insurers ponder the consequences of the Brexit referendum. In times of uncertainty strong leadership is invaluable.
The vote by the British public to leave the European Union (EU) has thrown the region’s financial services industry into considerable confusion. The effects of the Brexit vote are far from clear. And it looks like they’re not going to get much clearer for many months to come.
Insurers conducting business in the UK and Europe are uncertain how their own operations will be affected by possible changes in financial services regulations. Of especial concern is the future of the “passporting” rights that currently allow British-based firms to sell into EU countries without having a local branch. They’re also in a quandary about how they should advise their customers in the UK and EU to respond to the Brexit vote. Furthermore, insurers in the UK have to contend with anxiety among many of their staff about how jobs will be affected by the decision to leave the EU.
During such times of uncertainty, good leaders often come to the fore. They’re able to strengthen their ties with employees and customers by being clear and direct. Insurance executives would do well to filter out much of the noise that surrounds the Brexit issue and concentrate on authoritative sources of information. This will help them to communicate with their staff and customers about how their company will respond to Brexit developments. Clear, concise, concrete information is always more valuable than vague conjecture or stoic silence. A proactive and open approach to communication, which acknowledges what is unknown or undecided, builds trust and loyalty.
The uncertainty triggered by the Brexit vote also creates a good opportunity for insurers to review their risk management systems and processes. The effects of the referendum on their businesses, up until now, can be assessed and contingency plans for the future revised.
It is likely that it will take two years or more for the British Government to negotiate a withdrawal from the EU. During this time, insurers operating in the region will probably have to contend with continued uncertainty. This could further dampen economic growth and curb new business opportunities. Cost reduction, as well as on-going digital transformation, will remain high on their corporate agendas.
Insurance executives who display strong leadership, and a steady commitment to long-term business objectives, will best navigate their organizations through the trials of market confusion and uncertainty.