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11th May 2016
The latest Insurance Price Index from the British Insurance Brokers’ Association (BIBA) and Acturis that tracks £5.5billion of actual premiums paid annually via insurance brokers shows another significant rise in the level of premiums charged for private car policies yet home owners are benefiting from reducing insurance costs despite the recent floods.
The quarterly BIBA/Acturis index showed that in the first quarter of 2016 premiums paid for private car insurance rocketed with an increase of 7.2% – net of Insurance Premium Tax (IPT) – compared to the same period in 2015. This is the second quarter in a row that motor premiums have shown a significant increase, and means that once IPT is factored in, motorists are paying almost 10% more in premiums than they paid last summer and a massive 66.6% more in tax.
In his 2016 conference address Steve White BIBA CEO called the recent repeated hikes in Insurance Premium Tax an “assault”, robustly calling on the Chancellor to avoid increasing this tax on policyholders. He said; “Let’s be clear about a couple of things – insurance is not a luxury item, for many it’s a necessity and for all it is a wise precaution. And while IPT is a tax collected and remitted by insurers, it is a tax on premiums paid by policyholders – our message on IPT is firm – we’ve reached 10 [%], now never again.”
Its better news for home owners, who may have expected their household insurance premiums to increase because of the 2014/2015 floods as the index reveals a 6.5% reduction in premiums compared to quarter one 2015.
Theo Duchen, Co-CEO of the Acturis Group said; “The UK home insurance market is highly competitive which is why we are now seeing the lowest premiums being paid since we began tracking premiums in 2010. Of course once IPT is accounted for the premium savings are reduced by half, but this still remains good news for home owners.”
Steve White concluded; “In our 2016 Manifesto BIBA continues our commitment to allow access to insurance for all that is why we monitor premiums and work with the rest of the industry to promote fair premiums for all.”
- The BIBA-Acturis insurance premium index results: Q1 2016 compared to Q1 2015
Individual basket: +0.3%
Motor insurance: +7.2%
Home insurance: -6.5%
SME basket: +2.1%
Commercial vehicle: +4.8%
Commercial package: -1.7%
Larger commercial basket: -0.7%
Commercial combined: -0.7%
Fleet: -1.5%
Commercial liability: +1.2%
- For full details on what Steve White said on IPT in his conference speech click here
- . For further information please contact BIBA press office:
Pam Quinn, Communications Manager
020 7397 0223
- About the British Insurance Brokers’ Association
The British Insurance Brokers’ Association (BIBA) is the UK’s leading general insurance intermediary organisation representing the interests of insurance brokers, intermediaries and their customers.
BIBA membership includes just under 2,000 regulated firms.
General insurance brokers contribute 1% of GDP to the UK economy and BIBA brokers employ more than 100,000 staff.
54% of all general insurance is sold by an insurance broker and they arrange 79% of all commercial insurance business.
Insurance brokers put the client’s interests first, providing advice, access to suitable insurance protection and risk management.
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