Tuesday, 21 September 2010 12:00 AM
The cost of travel insurance is expected to rise by over 20 per cent early next year.
Specialist insurance broker PJ Hayman has predicted the “previously unthinkable” increase as a result of low interest rates, accumulated claims, a rise in VAT and large losses incurred by insurers.
The “unpredictable” rises follow three years of falling premiums.
Peter Hayman, director of PJ Hayman, explained: “For the last three years we have seen rates being driven downwards for several reasons: Comparison websites offering non-specialist cover are getting ever cheaper, brands are driving harder bargains with their insurance partners to position product offerings at prices and age limits that do not make underwriting sense.”
Travellers with pre-existing medical conditions and those over a certain age will find it harder to get cover.
PJ Hayman believes the increase will take some time to affect the public and that many rises will coincide with the increase in insurance premium tax on travel insurance from 17.5 per cent to 20 per cent on January 4th 2011.
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