The Budget

The recent budget included an effect on insurance.  Not only was an increase in VAT announced, but also an increase in Insurance Premium Tax (IPT).  Like VAT, the effective date is 4th January 2011, and the rate is set to increase from 5% to 6%.

The one exception to the normal IPT rules is Travel Insurance.  IPT for this is already charged at 17.5%, so this will increase to 20% from January next year.

Unlike consumer goods, you can’t really “beat the budget” with insurance.  If renewal of a policy is after the 4th January date then customers will have no choice but to pay the increased rate.