In a statement, the British Insurance Brokers’ Association (BIBA) said it welcomed “the fact that [the chancellor] leaves the IPT rate unchanged.
“This reassures insurance customers already facing premium increases for various external reasons,” the association said. “However, the tax remains a significant proportion of the cost of liability and we hope that future expenditure reviews will recognize the benefits to road safety of greater use of telematics-based policies by removing the tax on premiums for increase their adoption. “
BIBA added that removing or reducing IPT on cyber insurance policies would help “improve adoption and expand resilience”, given that only 6% of UK businesses have a policy in place. cyber insurance, citing the government’s latest investigation into cybersecurity breaches.
The Association of Medical Insurers and Intermediaries (AMII) also expressed relief that Sunak did not raise the IPT rate, but pledged the group would continue to push for lower-rated health products.
“We will continue to push for health care costs to be zero-rated for IPT purposes, consistent with other protective and general products, as they make an equally valuable contribution to the health of the nation and to the UK economy, âsaid Dave Middleton, Executive Chairman of MAI.
Read more: What has the 2020 budget brought to the insurance industry?
Here is a summary of some of the key points from Sunak’s speech and what the major players in the insurance industry are saying:
Taxation and universal credit
Sunak announced that the universal credit degression rate will be reduced from 63% to 55% by December 1, allowing applicants to keep more of the payment. The government would also increase universal credit working allowances for low income households by Â£ 500 per year.
Group Risk Development (GRiD), the sector body for the group risk sector, welcomed this development, saying it meant “not only that ‘work pays’, but also that group income protection pays. for those whose employers provide continuous income in the event that they are unable to work for an extended period due to illness, injury or disability.
The government has earmarked Â£ 24bn for housing, including Â£ 11.5bn for up to 180,000 affordable homes, with brownfields targeted for development. A 4% tax will also be imposed on property developers with profits exceeding Â£ 25million to help create a Â£ 5billion fund to remove dangerous coatings.
âWe welcome the government’s multi-year housing regulation, including its commitment to build new homes by regenerating brownfields across the UK,â said Claudio Gienal, Managing Director of AXA UK & Ireland. âAs we enter an exciting new phase of construction, which will place greater emphasis on sustainability and greater use of modern construction methods, it is imperative that the planning system and building regulations be redesigned to place the security and resilience of UK front and center housing. “
Gienal added that failure to do so “risks repeating post-war mistakes.”
“[These include] building houses and infrastructure unsuitable for future generations, which must be demolished or adapted decades later, âhe said. “[Regulations] should include the establishment of a legal obligation for all developers to consider the insurability of buildings at all stages of the planning process.
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Resumption of public services
The government plans to spend more than Â£ 8bn on a major catch-up program that will help the National Health Service (NHS) deliver elective care that has been delayed due to the pandemic. This will be supported by a capital investment of Â£ 5.9 billion, enabling the NHS to tackle the backlog of non-urgent procedures and modernize digital technology.
Middleton said he was delighted to see the Chancellor “inject much needed resources to tackle record NHS waiting lists” but admitted that more could have been done to urge the NHS and the private sector to health.
‘The measures he announced are unlikely to solve the unprecedented problems facing healthcare services and while subsidized private health insurance would undoubtedly reduce the burden on the NHS, it is a real shame that it does not. seems to be no appetite in government. take it into account, âhe said.
To reduce the likelihood and impact of floods, the government has reaffirmed the doubling
investments in the coastal flood and erosion risk management program (FCERM). The Â£ 5.2 billion investment is intended to better protect 336,000 properties across England from flooding. The government will also invest an additional Â£ 27million to support flood and emergency response activities and an additional Â£ 22million each year for the maintenance of flood defenses.
“We were delighted to see the government pledging an additional Â£ 22million each year for the maintenance of the flood defenses,” BIBA said. âWe were also delighted to see the government sponsoring a new National Infrastructure Commission study on the effective management of surface water flooding in England, which will also examine the role of a range of interventions, including traditional infrastructure and nature-based solutions. . We hope to work closely with the government to help introduce more general and property-specific resilience measures. “
Read more: Flood Re submits plan to reshape the flood insurance market
The government plans to increase public spending on skills and training by 42% to around Â£ 3.8 billion. Sunak also confirmed the upcoming launch of a UK-wide arithmetic program that will help 500,000 adults improve their arithmetic skills.
âWe welcome the government’s commitment to the skills and education funding arrangements as part of upgrading opportunities across the country,â said Genial. âHowever, the government needs to go further and faster in identifying and addressing the specific skills shortages facing the UK.
âAchieving government goals in key policy areas such as net zero, housing and the future of transportation depends on the rapid development of a versatile workforce with the right skills. The government should create and implement comprehensive skills strategies in each of these areas to ensure that there is the expertise capacity necessary to make real progress in the years to come.