Insurance Tax Increases
NSW & Victoria Increase Levies on Insurance Premiums
Both the NSW and Victorian State Governments have increased or introduced new levies on insurance premiums.
NSW
From the 1st of July 2009, all insurance premiums in NSW will attract a new SES Levy and an increase in the Fire Services Levy. In total, these changes increase the current levy from 36% to 40%.
What does this mean?
Example: An insurer charges $1,000 as the price for your insurance policy. On top of that $1,000 there are a number of government taxes and levies.
$1,000 premium
$400 FSL & SES
$140 GST (charged on combined premium and levies)
$138.60 (9% NSW stamp duty charged on all above combined)
$1,678.60 You pay.
With slight increases in insurance premiums also coming in to effect NSW policy holders can expect to pay around 5% more for insurance this year, provided you have had no claims or other changes.
Victoria
There have been 2 increases in the Fire Services Levy this year. On the17th August 2009 the latest increase came in to effect. Metro policy holders will now pay 50% FSL while Countyr policy holders will pay 84% FSL.
What does this mean?
Example: An insurer charges $1,000 as the price for your insurance. On top of this $1,000 there are a number of government taxes and levies.
$1,000 premium
$840 country FSL of 84%
$184 GST charged on combined premium and FSL
$202.40 Stamp Duty charged on all above combined
$2,226.40 You pay
As you can see, the levies and duties more than double the actual price of the insurance. Metro policy holders in Victoria can expect to pay at least 10% more this year from these tax increases. Country policy holders can expect to pay at least 25% more.
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