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Scottish independence - the possible effects on health insurance


The Financial Services Bill 2012 applies equally to Scotland, but lawyers Brodies ask, what happens if Scotland opts for independence? “It seems highly unlikely that Scottish voters would favour the introduction of the euro, if the outcome of a referendum favoured independence. Scotland might retain sterling as its preferred currency. It seems likely that an independent Scotland using the pound sterling as its currency would have to adhere to the main provisions of the Bill if it wished to be part of a sterling currency union.”


But they suggest an alternative-a parallel universe; “An independent Scotland might decide to establish its own central bank, issue its own currency and/or set up its own financial services regulatory regime. It could be argued that this might prove to be less complex and less restrictive than the alternatives.”


They provoke debate; “ In light of Scotland’s heavy dependence on the financial services sector this is a subject which will need to be thought through in great detail since the implications of any policy decisions could have a significant impact on the country’s competitive position. A good deal of financial regulation emanates from Brussels and is then implemented in detail by individual member states. At present, almost all financial services regulation applies equally across all parts of the UK. This makes it relatively easy for firms to develop common forms and procedures which can be used for transaction throughout the UK.”


There are several insurers based in Scotland who sell more outside Scotland than at home, so they may have to choose whether to stay in Scotland or move to England.


Brodies speculate, “If Scotland were to become an independent country, would we see the emergence of a new Scottish Financial Services Regulator? This is a crucial question since Scottish businesses sell regulated products to consumers in all parts of the UK and businesses in other parts of the UK sell regulated products to Scots.”


The lawyers may frighten Scottish insurers with their next suggestion,  “ Might it require firms operating in Scotland to develop different requirements for financial promotions or documentation for use with financial services products in Scotland?” 

Health insurance news: 15 February 2012