Our approach to IPT changes

Posted on: 13 August 2015

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This article and downloadable Broker Notice document explains Allianz Insurance plc's response to the increased rate of Insurance Premium Tax (IPT).

In the Summer Budget, announced 8 July 2015, the Chancellor confirmed an increase of 3.5% in the standard rate of IPT.

This increase will see the standard rate move from its current 6% to 9.5%. The new 9.5% rate will be effective from 1 November 2015.

 

Allianz's approach to the change

The IPT charges outlined below will be based on the effective date of a transaction, rather than the date the transaction is keyed.

New Business and Renewal transactions

From 1 November 2015, all New Business and Renewals will have a 9.5% IPT rate applied, i.e.

  • Inception / renewal date before 1 November 2015: 6%
  • Inception / renewal date on or after 1 November 2015: 9.5%

 

Mid Term Adjustments (MTAs) on policies incepted or renewed before 1 November 2015

Refund Premiums (RPs):

For any MTA which results in a reduction in premium, the refund amount will reflect the original rate of IPT at 6%, i.e.

  • Effective date of MTAs before 1 November 2015: 6%
  • Effective date of MTAs on or after 1 November 2015: 6%

Additional Premiums (APs):

For MTAs on or after 1 November 2015 which result in the customer needing to pay additional premium, the new rate of 9.5% will apply, i.e.

  • Effective date of MTAs before 1 November 2015: 6%
  • Effective date of MTAs on or after 1 November 2015: 9.5%

This approach is applicable to both our Personal (Allianz Retail) and Commercial policies.

 

What this means for you

Our approach ensures there is clarity on the rates to be applied from a customer point of view.

To ensure compliance with the new IPT rates, please make sure your customers understand the increase in the tax and the financial implications.

Each bespoke scheme and arrangement will be looked at on an individual basis and, where necessary, one of our project team will get in touch.

 

Want more information?

If you have any questions, please contact your dedicated Allianz representative or support team.

To download this information in full as a PDF Broker Notice document, click here.

More general information on the IPT change can be found on the Gov UK website.