Premium tax causes health cover to fall for second year

Rocketing insurance premium tax is a key reason why the UK medical cover market showed flat growth for the second year running, with only four million policies taken up, according to analysts.

health-cover-market-report-15th-edLaingBuisson said the market has been ‘onerously burdened’ by steep rises in the tax resulting in more lapses.

Health Cover Market Report author and economist Philip Blackburn called demand for private medical cover ‘stagnant’.

He said: ‘Driving this has been the high cost of taking out standard cover, exacerbated by the recent sharp increase in tax burden from insurance premium tax.’

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