Legal and General (L&G) has announced today that it has made the decision to leave the Association of British Insurers (ABI), at the end of 2014
Through an official statement today the insurer blames the fact that L&G’s business has evolved over time, with a large proportion of its business now falling outside the remit of the ABI.
Nigel Wilson, Group Chief Executive, Legal & General Group Plc said in a letter to the ABI that L&G recognise and has appreciated the invaluable work that ABI has achieved for the industry in setting codes of conduct and standards, representing the industry at UK and EU level and in raising the general profile of the industry.
Mr Wilson continued: “Following the recent change in the constitution and mandate of the ABI as a result of the transfer of investment business to the IMA, we have given considerable thought to the question of our continuing membership. This is a reflection of the fact that a large proportion of our business lines will fall outside of the remit of the ABI given that the business of Legal & General has significantly evolved and in 2014 our business is now as much investment management as insurance.”
“There is also a recognition that even within the insurance sector the ABI often concentrates, for understandable reasons, on the general insurance sector where as you are aware we have only limited business lines. Additionally, our public policy work increasingly involves sharing commercial aspects of our business with government which, for very obvious reasons not least Competition Law, we cannot share with competitors. We believe that increasingly engagement with government, regulators, quangos and other external bodies will be on a case by case basis going forward and will have to be more individually tailored to individual company situations as business models of sector participants become more diverse and less suited to uniform representation through one trade body.”
“As a consequence, our view is that our shareholders’ and policyholders’ interests are best served through Legal & General engaging through a variety of interfaces rather than through one trade association and therefore we have decided to terminate our membership of the ABI (including the Life Insurance Council and the General Insurance Council) by serving notice with effect from today.”
“Working with our members we will continue to drive the reform agenda forward to make markets work better for customers on policy areas as diverse as pensions, use of data, welfare policy, tax and regulation to ensure the UK insurance sector continues to contribute positively to the economy and society.”
With the decision for L&G to leave the ABI it is highly likely that chief executive Nigel Wilson will step down from the association’s board.