§ Mr. Alasdair MorganTo ask the Chancellor of the Exchequer what assessment he has made of the trend in the provision of travel insurance from(a) travel agents, (b) direct insurance brokers, (c) credit card companies and (d) other sources since the introduction of higher rate insurance premium tax. [31111]
§ Dawn Primarolo[holding answer 25 February 1998]: There is no conclusive evidence that any shift of business is due to the price effect of this measure. Figures supplied by travel agents support estimates that such outlets have lost between 5 per cent and 10 per cent of their travel insurance customers since the introduction of the higher rate of insurance premium tax (IPT). However, they also suggest that travel agents have been losing travel insurance business regardless of whether or not they have increased their insurance premiums in response to the tax change. This is in line with a 1996 Mintel survey which identified that in the period between 1992 and 1996 the share of the travel insurance market enjoyed by other outlets rose from 12 per cent to 23 per cent. I have no reliable information on how the current decline in market share is shared between other providers.