Travel insurance tax criticized

The UK government’s tax on travel insurance has come under fire from ministers.

Travel Insurance News - 17/12/2012

<< Report: half of UAE residents go without travel insurance | Travel News | Ryanair rated worst short-haul carrier >>

The UK government’s tax on travel insurance has come under fire from businesses and ministers.

All travel insurance policies taken out in the United Kingdom entail a tax of 20 per cent – a rate far greater than seen in the policies of many other countries. Now, some lawmakers and insurance firms say that the ‘excessive’ levy is irresponsible and is encouraging Britons to go on holiday without proper coverage.

For a family of four, the 20 per cent insurance premium tax (IPT) raises the cost of a trip by about £15, according to a new report from the Daily Telegraph. In comparison, Sweden’s government has no such tax, nor does Belgium’s, whilst French and Greek travellers pay just half of what their British counterparts do.

The news comes as the government continues to urge holiday makers to buy insurance before setting out; last week saw the Foreign Office issue a fresh warning for skiers to ensure they’ve taken out a policy that covers injuries related to winter sports.

Meanwhile, officials from one travel website have said that the tax ends up being passed on to consumers, which deters many from taking out cover. Stuart Bensusan said on behalf of Essential Travel that the IPT tax shows that the government is “willing to put citizens at risk”.

<< Report: half of UAE residents go without travel insurance | Travel News | Ryanair rated worst short-haul carrier >>