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MSE News: Autumn Statement 2016: Insurance premiums likely to rise for millions

Millions of households and motorists are likely to be hit with higher insurance premiums from next June...
Read the full story:
'Autumn Statement 2016: Insurance premiums likely to rise for millions'
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Comments

  • One-Eye
    One-Eye Posts: 68,743 Forumite
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    Are we sure this increase will apply from June 2017. Its surprising that he hasn't applied the increase retrospectively to screw us over just like this government already has with the student loan repayment threshold.
  • One-Eye wrote: »
    Are we sure this increase will apply from June 2017. Its surprising that he hasn't applied the increase retrospectively to screw us over just like this government already has with the student loan repayment threshold.

    Yes. This is the 3rd increase in 18 months, the last two haven't been retrospective.

    And it couldn't be anyway, as the insurer collects IPT from the consumer at point of sale/payment. If it transpires that amount wasn't enough due to a retrospective increase; the insurer couldn't be expected to either cover the difference or chase the client to pay more for cover they've already had.
  • I suspect that the government is going to keep bumping up this tax until it matches the level of VAT. In effect, it is double taxation. They are taxing the premiums, which fund the claims, and then raking in VAT on the pay outs as well.

    This is a very unfair tax. It doesn't target the better off; it hits those who are already paying exorbitant premiums, such as young drivers, and homeowners in flood-risk areas or with subsidence history.
  • Quentin
    Quentin Posts: 40,405 Forumite
    PhilBee wrote: »
    In effect, it is double taxation. They are taxing the premiums, which fund the claims, and then raking in VAT on the pay outs as well.....
    In what way?


    There is no VAT payable on any money you get paid out by an insurer.
  • Quentin wrote: »
    There is no VAT payable on any money you get paid out by an insurer.

    The money paid out is for repairs or replacements, which will include VAT.
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