Disallowing the tax deduction for reinsurance between affiliated entities would have a “detrimental effect on U.S. consumers” and lead to higher insurance premiums, the head of a trade group representing European carriers warned.

In a letter to members of Congress, Tommy Persson, president of the CEA–a European insurance and reinsurance federation–made the comments in response to proposals in Washington designed to restrict the ceding of premiums to offshore affiliates.

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