IPT and VAT changes will have significant impact on brokers

The Insurance premium Tax (IPT) and VAT changes announced in the emergency budget will have far-reaching consequences for brokers and insurers beyond the initial pain to policyholder’s pockets, according to Kevin Kiernan, director of personal lines, Groupama Insurances.

“Tuesday’s confirmation of the rise in IPT was no great surprise but rather disappointing all the same. But while much of the current focus is on how this might impact policyholder premiums, what needs also to be considered is that the change itself will create a whole raft of costs to brokers and insurers that will need to be passed on.

“For example, from an administrative point of view, a 1% increase in IPT creates the need for IT system changes in broker and insurer businesses across the UK