Chaucer, the Lloyd’s of London insurer, has reaffirmed plans to move offshore by 2011 due to high UK corporate taxes.
The announcement by chief executive Bob Stucherry came on the same day that the Group reported a pre-tax profit of £42m in 2009, compared with a loss of £26.2m the year before.
Analysts said the insurer would most likely move its headquarters to Ireland or the Netherlands, following in the footsteps of rivals Beazley and Brit Insurance in 2009. Chaucer, Amlin and Novae Group are the only three publicly traded Lloyd’s insurers to still have their headquarters in the United Kingdom.
“If most of our peer group has already re-domiciled to a more favourable tax environment, that is a disadvantage to us. It’s something as a board we have to give consideration to,” Stuchberry said.
Although the company said the disruption the firm would experience from moving out of the UK and the future impact of claims equalisation reserves in the UK would even out.
Its return to profit followed on higher investment returns and was also helped by a benign US hurricane season.
The company said 2010 has been tipped as a positive year for growth, despite the softening of rates across some classes of business.
The UK’s corporate tax rate currently stands at 28 per cent, the eighth highest in the European Union.