Are you aware of the increase?

by JOANNE LOUHAICHI / January 23, 2016

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.

During his Budget speech, Osborne claimed that IPT in Britain was "well below tax rates in many other countries".

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%.

Worrying predicted reaction

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 as a result of the tax hike.

Your home insurance may not be due just yet, but you should budget for an increase next time it comes around.

For peace of mind, contact your account manager now. He or she will be able to advise you correctly.

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