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Brexit disruption to firms ‘unavoidable’ with worst to come

Brexit disruption to firms ‘unavoidable’ with worst to come

Britain's Prime Minister Boris Johnson wears a protective face covering as he arrives at the BBC in central London on October 4, 2020, to take part in the BBC political programme The Andrew Marr Show. - British Prime Minister Boris Johnson and EU chief Ursula von der Leyen on Saturday asked their negotiators to "work intensively" to overcome differences to secure a post-Brexit free trade deal. (Photo by JUSTIN TALLIS / AFP) (Photo by JUSTIN TALLIS/AFP via Getty Images)
Prime minister Boris Johnson. Photo: Justin Tallis/AFP via Getty Images

UK firms risk collapse on a “significant” scale if Brexit leaves them struggling to raise cash in the sectors most exposed to trade disruption, a think tank has warned.

A new report by the Institute for Fiscal Studies (IFS) sounds the alarm over the economic toll as Britain’s EU trade relationship unravels when it sees Brexit ‘go live’ at the end of the year. A transition period, keeping Britain closely tied to the bloc, expires on 31 December.

“Deal or no deal, substantial economic disruption in early 2021 is now likely unavoidable,” said the bleak IFS analysis published on Tuesday. “The majority of Brexit-related adjustment lies ahead.”

READ MORE: UK unemployment hits 1.5 million on leap in redundancies

Yet some consequences could last for decades, according to the study, with areas and workers linked to EU-reliant manufacturing, financial and business services falling victim to a “substantial restructuring” in the economy.

The biggest effects of Brexit are also likely to hit sectors different to those hardest hit by the pandemic, according to researchers.

Watch: What is a no-deal Brexit and what are the potential consequences?

The IFS warns:

  • The UK government’s red lines — resisting EU rules on standards or any transition extension — mean even a new deal will be “much closer” to no-deal than former prime minister Theresa May’s ‘Chequers’ plan. “This sort of agreement is unlikely to avert most of the adverse consequences for UK–EU trade associated with Brexit.”

  • GDP growth will be 2.1% lower next year than if the UK remained closer to the EU, staying in its single market and customs union. In a normal year, this would be enough to push the economy into recession.

  • A likely “thin” trade deal will mean new barriers

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Car insurance UK: Drivers able to make savings as firms offer ‘financial support’

Car insurance UK: Drivers able to make savings as firms offer ‘financial support’

This means that many car insurance customers can make tweaks to their policies without fee or risk of suffering any heavy losses.Experts at uSwitch have urged customers that it could be worth going to firms to waive these fees and make changes which could reduce costs.

They specifically highlight how road users can update their mileage details to reduce their perceived road risk and therefore lower charges.

They warn that if your car is due for renewal, it is worth recalculating mileage based on how much you have driven in 2020.

This is expected to be wildly different from the mileage predictions submitted at the start of last year before the lockdown was considered.

This is especially the case for road users who may have been forced to work from home for long periods and give up a long daily commute.

READ MORE: Car insurance customers can ‘cut the costs’ of a policy today

“So if you want to recalculate your mileage, it could be worth giving them a call to waiver the amendment fee.
“If you have a record of your mileage from the last time you applied for cover, you could use this to calculate the difference used this year.

“If you don’t, you can always sum up how far you’ve travelled each day on average to get a rough estimation.”

MoneySavingExpert Martin Lewis has previously urged road users to take advantage of the sudden cut in cancellation and amendment fees to their advantage.

He revealed it was a great time for customers to shop around and switch for a new agreement as drivers would not be liable for costs.

Switching mid-agreement would result in heavy cancellation costs but under current measures, drivers can swap completely free of charge.

He has urged drivers to switch policies regularly to

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Courts siding with insurance firms over business interruption claims | Business

Courts siding with insurance firms over business interruption claims | Business

A growing number of U.S. courts are ruling against employers who’ve filed insurance claims for business interruption coverage stemming from government-ordered coronavirus shutdowns.

The Insurance Information Institute reports insurers have won more than a dozen cases since May, with judges ruling that the policies only kick in if a property sustains physical damage. The business owners had argued that the coverage should have started when local or state governments issued stay-at-home orders that hampered their ability to operate.

A couple of Charleston-area cases are still pending in federal court. Black Magic Cafe says its losses started on March 17, when Gov. Henry McMaster ordered a temporary halt to dine-in services at South Carolina restaurants.

The historic Calhoun Mansion at 10 Meeting St., now known as The Williams Mansion, sued its insurer after a McMaster executive order shut down museums.

Charleston cafe takes on insurance firm in fight over coronavirus claims

A bill that would have required insurance carriers to cover coronavirus-related business losses — co-sponsored by Sen. Sandy Senn, a Charleston Republican, and Sen. Marlon Kimpson, a Charleston Democrat — was introduced in the S.C. Statehouse in April but went nowhere.

Recent court rulings indicate the local cases might be a losing cause.

For example, Judge Thomas Thrash last week dismissed a federal lawsuit brought by restaurant in Georgia, ruling that a government stay-at-home order did not cause the business to sustain direct physical loss of or damage to its insured property or surrounding premises.

Owner of Charleston's historic Calhoun Mansion suing insurer over COVID-19 claims

Similarly, a U.S. District Court judge in Florida last month dismissed a trade show display company’s claims, saying “the plain language of the policies reflect that actual, concrete damage is necessary.”

And in another ruling in California last month, Judge Cathy Ann Bencivengo ruled against a pair of barbershops, stating: “Most courts have rejected these claims, finding that the

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UK financial services firms turn cautiously optimistic

UK financial services firms turn cautiously optimistic

LONDON (Reuters) – Financial services firms in Britain turned more optimistic for the first time this year as a drop in business bottomed out, but big uncertainties remained about COVID-19 and a post-Brexit trade deal, according to a survey published on Thursday.

a tall building in a city: FILE PHOTO: Skyscrapers in The City of London financial district are seen during sunrise in London

FILE PHOTO: Skyscrapers in The City of London financial district are seen during sunrise in London

A drop in profits for banks, finance companies and building societies was partly offset by growth in earnings from insurance and investment management, the quarterly survey by the Confederation of British Industry showed.

“While it is reassuring to see business volumes begin to stabilise in a sector so vital for the UK’s recovery, financial services isn’t out of the woods just yet,” Rain Newton-Smith, the CBI’s chief economist, said.

Video: Dollar will go up on stimulus deal, but not for too long: Strategist (CNBC)

Dollar will go up on stimulus deal, but not for too long: Strategist



Staff numbers fell less severely than in the previous three-month period and the decline was expected to slow again.

Investment excluding technology was likely to fall in the year ahead, weighed down by the deepest demand uncertainty in eight years caused by COVID-19 and unresolved trade talks between Britain and the European Union.

Non-performing loans grew but at a slower pace than earlier in 2020.

The survey was conducted between Sept. 1 and Sept. 19 and 133 firms replied.

(Writing by William Schomberg)

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