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<p>Insurers must pay IPT on the value of premiums received for general insurance.
If insurers pass on the full rate increase to their customers, the impact on premiums
would be an increase of only 3.5%.</p><p> </p><p>Tax forms only a small part of the
cost of motor insurance. Other factors include competition, the volume of low value
personal injury claims and fraud. The government has taken steps to crack down on
the fraud and claims culture such as announcing at Autumn Statement 2015 proposals
to end the right to cash compensation for minor whiplash injuries. The government
expects the insurance industry to pass an average saving of £40 to £50 per motor insurance
policy on to consumers.</p><p> </p><p>The government also encourages consumers to
shop around for the most suitable cover at the best price.</p><p> </p><p> </p><p>
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