As covered in a previous article on High Gear News we have recently seen an increase in Insurance Premium Tax, with Autumn expected to reveal another hike. Increasing rates for both the drivers and the industry, this change has not gone down too well with the industry, with many insurers passing comment on the 12% increase on 50m general insurance policies each year.
Amanda Blanc, the group CEO of one of t AXA, is just one insurer disheartened by the taxi hike.
“This is a classic case of the government giving with one hand, in the form of whiplash reforms, and taking with another,” she said. “The affordability of insurance is being fundamentally threatened. The country is already underinsured and ever-rising insurance taxation could have the unintended consequence of making this situation even worse.”
While increases are often inevitable the constant hikes are one of the reasons insurers are fighting back against these government changes. Supporting in some areas such as whiplash claims, the general consensus is that the government are giving with one hand and taking with the other, only pretending to be supportive.
AA president Edmund King predicted that the extra tax would only contribute to the 1m uninsured drivers currently on UK roads.
“In 18 months, tax on insurance will have doubled – no other tax has increased by that much,” he said.