Why Your Policy Will Rocket In Cost This Year
September 18th, 2017, Joanne Louhaichi.
Why you must avoid the temptation to cut back on your policy
Anyone who follows current affairs, will know that George Osborne, the Chancellor of the Exchequer, is about to increase the rate of insurance premium tax (IPT) on motor and home insurance. Policies will increase thus tightening the financial belts for millions of people.
Perhaps what’s more worrying, is that the number of people cutting back on their policy to keep the costs down, is set to rocket. Meaning thousands of properties across the UK could well be under insured. Great if nothing happens. But what if it does?
What does this rate increase mean for the man on the street?
Some types of cover, for example life insurance and long-term health insurance, are exempt, while travel policies are already taxed at a higher rate of 20%.
During his Budget speech, Osborne claimed that IPT in Britain was "well below tax rates in many other countries".
But the rate of IPT on home insurance is, according to Osborne, going up from 6% to 9.5% in November of this year. Worryingly, analysis suggests some people may cut back on the level of cover they have because of the tax hike.
Your home insurance policy may not be due just yet, but you should budget for an increase next time it comes around. Most home insurance companies will inform their customers of the increase, but its still much better to keep one step ahead and understand what it means for your household or your own business.
So, don’t get tempted by taking a slice of next year’s policy. Contact us today for some peace of mind.