On June 1st 2017 the rate of insurance premium tax (IPT) went up from 10% to 12%, the fourth increase in just six years, and many industry experts are claiming that millions of us Brits could be worse off because of it.
Read all the need-to-know info and find out how you can keep your costs down here.
What Has Changed?
Earlier this month, IPT rose 2%, something that could add £47 to the average annual bill according to The Association of British Insurers (ABI). In fact, the ABI says "higher insurance bills for many look inevitable".
Why is this? Well, although this is a tax on insurers, not the consumer, many organisations are choosing to pass on the price hike. As a result, whether you're taking out a commercial or private policy, this new figure could mean that you will be paying double the IPT than you were two years ago.
This 2% rise has been put in place to raise £5.8 billion of government spending, however the British Insurance Brokers' Association (BIBA) claim this is unprecedented and are calling for a freeze on insurance tax increases.
Businesses and individuals will both be hit, with 'high-risk' customers, such as young drivers and those with property in flood zones, being the worst off.
James Dalton, Director of General Insurance Policy at the ABI, said:
"This tax penalises hard-working families, as well as businesses, who have done the right thing by taking out insurance to protect against many of life's uncertainties.
"This latest hike must be the last. The next government must freeze this tax, to give hard-working households and businesses a break."
What Does This Mean for You?
We understand that an increase in insurance premium tax could mean more expensive policies, but there is no need to reduce the insurance protection you have or go without it altogether in order to keep costs down. Insurance is a basic requirement for many and not something you can go without.
Here at Business Compare, we're helping to save our customers money by comparing cover quotes to ensure they get a competitive deal that is tailored to their specific needs. We work closely with insurers and constantly review the products we provide to ensure we can offer the best prices possible.
Find out how much you could save by comparing business insurance with us today.
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