Sheffield broker says insurance premium tax increase is bad news for customers

29th November 2016

Sheffield broker IFM Insurance says the latest increase to Insurance Premium Tax(IPT) announced in last weeks Autumn Statement is bad news for customers.

The tax on insurance policies will increase from 10% to 12% from June 2017. It is the third time the tax has been increased in less than two years. In July 2015 the Summer budget saw it grow to 9.5% and just months later, in March this year, it went up again to 10%. John Leigh a Director at IM Insurance said: -This is an unwelcome increase which could lead to some customers not bothering with insurance cover as the cost because too prohibitive. In the case of motor insurance we could see a rise in illegal drivers as the new tax kicks in next year. What's more some customers may inadvertently find themselves underinsured as they scale back on their insurance cover to compensate for the increase in IPT.