Cullum warned of future sleepless nights due to changes regarding the economy in coming years

Towergate chairman Peter Cullum says more insurers will quit the UK if taxes rise.

Cullum, speaking at the Changing World Debate at last week’s Biba conference in London, said: “There will be a huge number of people going offshore … because there is a huge incentive for them to go offshore.”

Cullum said capital gains tax was likely to increase up to 50%, while Oval chief executive Philip Hodson believed that there would be a rise in corporation tax.

Lloyd’s chief executive Richard Ward said the uncompetitive tax regime was forcing insurers to redomicile, and feared the coalition government would not take the steps to make the UK competitive again.

Asked about their predictions for the economy, there was a general consensus from the panel, which also included Aon’s Rob Brown, that it faced serious challenges.

Cullum said: “This is one of those moments in history that has a negative connotation on a scale that would keep you awake at night.

“We are going to go through years of unbelievable changes.”

On regulation, Hodson feared that the new government would ramp up regulation.

He said: “There will be more because of the climate, not because of the Lib-Dem coalition.”

He accused the FSA of lumping insurers together with banks, adding: “The regulator is using a hammer to crack a nut.”