Following George Osborne’s shocking announcement about the rise in IBT tax we thought we would look into the extent this will affect UK motorists; with such rises eventually costing the policyholder.
Uncovering a rise from 6% to 9.5% the Tories announcement has not gone down well to say the least, with brokers, providers and motorists coming together to form a backlash.
“We are extremely disappointed in this rise, as this will mean insurance for consumers will become more expensive,” said Steve White from the British Insurance Brokers’ Association. “Those hit by this stealth tax will include the 20.1million households with contents insurance, 19.6million with motor insurance, and 17million with buildings insurance.
Will insurance rates go up?
With the government placing more financial pressure on insurers it will not be viable for providers to swallow such costs, having no choice but to work these outlays into their customers’ policies. With an increase meaning a higher rate of people not being able to afford cover the industry may witness more and more insurance driving illegally, choosing not to have a policy at all.
Imran Ahmed, High Gear Director said:
‘Our customers already require support to reach premium prices, with our monthly payment schemes often being a saviour. With further increases in tax we are worried that measures will have to be taken to lower the rates to meet budget’.
‘Also, with more drivers unable to afford insurance we could see more claims on hour hands, with uninsured drivers involved in accidents on the road.
Let us know how you feel about this announcement by leaving your comments below.