Insurance costs to rise again thanks to the Chancellor

While there were plenty of people-pleasers in yesterday’s Autumn Statement, it’s safe to say that insurance companies were not happy. Yes, there will be a crackdown on fraudulent whiplash claims, and yes, there is another freeze on fuel duty (all good news for insurers and their customers). But these aren’t the issues clogging my inbox this morning. Insurance Premium Tax (IPT), that’s what’s got them all going. This is the crux of the matter: the former Chancellor George Osborne announced an increase in IPT from 6 per cent to 9.5 per cent in the Summer Budget in July 2015 which came into effect in November of the same year. The rate was increased again to 10 per cent in this year’s March Budget, coming into effect on October 1. And now this third increase, due for implementation in June 2017, to 12 per cent. In a nutshell, it means the tax has doubled in less than 18 months.