If the United Kingdom withdraws from the EU on 29 March 2019 without an exit agreement (no deal-Brexit), UK insurance undertakings will not have passporting rights to legally carry out insurance business in Denmark or in EU. The Danish Financial Supervisory Authority has on 12 March 2019 sent a proposal for an Executive order to consultation. The Executive Order lays down that UK insurance undertakings can continue carrying out insurance activities in Denmark on a freedom of service basis in case of a no deal-Brexit.
EPIOPA published its recommendations of 19 February 2019 for the insurance sector in light of the United Kingdom withdrawing from the European Union (EIOPA-BoS-19/040).
The proposal for the Executive Order as submitted by the Danish Financial Supervisory Authority applies to insurance undertakings domiciled in the United Kingdom and which were notified to carry out non-life insurance or life insurance in Denmark as of 29 March 2019.
The purpose of the Executive Order is to ensure that UK insurance undertakings in case of a no deal-Brexit may continue to carry out insurance activities in Denmark on a freedom of service basis in regard to already concluded insurance contracts. The UK insurance undertakings will be able to carry out these insurance activities until 31 December 2020.
The UK insurance undertakings comprised by the Executive Order are not allowed to underwrite new insurance contracts or to renew, extend, resume or otherwise prolong existing insurance contracts after 29 March 2019.
The Executive Order stipulates that the UK insurance undertakings will continue to be subject to rules in the Executive Order on Good Practice for Insurance Distributors, Executive Order on Information on Fees and Other Costs for Insurance Undertakings, and Executive Order on Information on Life Insurance Contracts. Furthermore, the UK insurance undertakings are obliged to ensure that the Danish Financial Supervisory Authority is in possession of a number of information in relation to the undertaking.