The British Insurance Brokers’ Association has called on the government to make multi-occupancy residential buildings that require building safety-related remediation exempt from Insurance Premium Tax.

Ahead of the Spring Budget, the association has also called for a cut to the headline rate of IPT from 12% to 10%; and for IPT on travel insurance to be aligned with the standard rate, ending the anomaly whereby 20% is applied.

Further, BIBA has urged the government to invest in flood defences, to reform the apprenticeship levy, and to exempt cyber insurance from IPT, as the current low take up from businesses potentially causes a major exposure to UK firms.

The association says these “straightforward interventions” called for in its budget submission to Treasury can reduce some of the cost burden, largely due to inflationary pressures, that consumers and businesses are facing through their insurance.

Graeme Trudgill, BIBA’s chief executive, commented: “We know individuals and businesses are struggling due to the cost of living, and this sits at the heart of our calls to action in our latest Manifesto and our budget submission. Recently there have been multiple stories about businesses and consumers cutting back on their insurance cover levels, or in extreme cases, cancelling cover entirely and we believe that these measures will make a difference.”

To help flood affected properties, BIBA has asked for government to commit to long-term investment in flood defences at a higher level than 2020; exempt flood resilience materials from VAT, to reduce their cost and increase deployment; and to restate the commitment made in 2016 to ring-fence a proportion of IPT receipts to specifically fund flood defence investments.

The calls go alongside the need, as outlined by BIBA, for broader reforms to planning consent for buildings planned in areas of flood risk, and a need for local authorities to enforce existing regulations on new builds.

Trudgill added: “2024 marks the start of the election year, and at a time when political parties are trying to appeal to the country for support, they need to consider the realities people are experiencing. Particularly when their key economic targets include growth and economic security.

“We believe the measures we have set out would help increase the attractiveness of insurance; deliver cost savings for individuals and businesses; and improve wider resilience against flooding.

“Ultimately, insurance brokers always have customer protection at the heart of what they do, and we believe the upcoming Spring Budget is a great opportunity for the government to act on this at a national level.”

---