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BIBA looks at changing rules around PMI tax

Thursday, October 28, 2010

According to a new statement issued by BIBA (the British Insurance Brokers’ Association), the group have been examining the issue taxation in relation to private medical insurance, in a bid to prevent people from being put off from taking out cover for their healthcare needs.

The Healthcare Focus Group within BIBA have been charged with the task of examining the tax associated with PMI, investigating if it will be possible for people to be offered reductions in tx as an incentive to generate sales.

The head of BIBA’s technical services division, Peter Staddon, has commented: "The last government withdrew the over 60's tax concession and we saw a dramatic reduction in the sales of PMI cover.
With the increase in insurance premium tax (IPT) due in a little over 10 weeks this could again have an effect on the purchasing of cover. As a committee we are keen to investigate if tax concessions are a possible solution to encourage future sales."

BIBA will be considering a number of factors relating to tax breaks in association with PMI purchases, including how the removal of tax concessions have led to the reduced sales in the private medical health market, and what the implications are for taxation in small and medium businesses and employers. The group is expected to share their findings from the review with a number of key figures across the insurance industry, including political stakeholders.

The British Insurance Brokers' Association (BIBA) is the UK’s leading general insurance organisation representing the interests of insurance brokers, intermediaries and their customers. BIBA membership includes 1700 regulated firms. Insurance brokers and intermediaries distribute nearly two-thirds of all UK general insurance. In 2007, insurance brokers and intermediaries generated £1.5 billion of invisible earnings and they introduce £22 billion of premium income into London’s insurance market each year.

Category: Health Insurance

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* The Costs detailed are based on a man or woman in good health, aged 19 on their next birthday. These details are correct as of September 2010

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