The US department of the Treasury and the office of the US Trade Representative plan to ink a bilateral insurance agreement with the UK ahead of Britain’s departure from the European Union next year.

The US-UK Covered Agreement is said to offer regulatory certainty and market continuity in the wake of Brexit.

It is also said to make US firms more competitive in domestic and foreign markets, while making regulations more effective.

On being effective, the pact would affirm the US state-based system of insurance regulation as well as enhance growth opportunities for the country’s insurance players, the regulators said.

Britain trade commissioner for North America Antony Phillipson said: “I’m very pleased that we’ve been able to preserve the benefits of the EU-US covered agreement for UK firms in the US, the largest insurance market in the world, once the UK has left the EU.”

With the announcement, a 90-day notification period begins before the pact is implemented.

London Market Group government affairs workstream chairman Malcolm Newman said: “The LMG welcomes the news of a new bilateral insurance agreement between the United States and the United Kingdom, which will provide much needed certainty and market continuity for UK firms operating in the US.”