American International Group (AIG) in March 2017 announced that they will open offices in Luxembourg to ensure operations in the European Economic Area (EEA) and Switzerland after Britain leaves the European Union are not affected in any way.

AIG has long written business in Continental Europe from the U.K. under the umbrella of AIG Europe Limited, which has branches across the EEA and Switzerland. By 2019, AIG will have two subsidiaries in Europe: one in the U.K. to write U.K. business and one in Luxembourg to write EEA and Swiss business.

Luxembourg was reportedly chosen over Ireland for its legal and social stability; experienced and well-respected regulators; and proximity to major markets such as Benelux, Germany, and France. The new proposed European legal structure is expected to be completed by the first quarter of 2019, subject to regulatory approvals.

AIG appears to be hedging its bets, should forthcoming Brexit negotiations result in denying U.K.-based insurance companies to do business in the E.U.

This move may not be of great immediate significance to the employee benefits market as AIG Europe Limited mostly writes P&C business. Nevertheless, it also offers group personal accident and travel insurance; international private medical insurance for expatriate employees; corporate catastrophe cover in relation with existing death in service plans; and other specialty solutions.

But AIG’s choice of Luxembourg and its early decision may be the first in a long line of insurers that have used London as their springboard into Continental Europe. Even if getting a Luxembourg insurance license is a relatively quick process, the administrative workload and time required to get other E.U. licenses even with the so-called “passporting” provisions should not be underestimated.