Simplyhealth research shows a rise in Insurance Premium Tax would deter employers from providing health benefits
Latest research from Simplyhealth, ahead of this month’s budget, shows that two thirds of HR decision-makers who currently offer health and wellbeing benefits and intend to next year (66 %*) anticipate their organisation would either reduce or remove the health and wellbeing benefits they currently offer, as a result of an increase in Insurance Premium Tax (IPT).
The standard rate of IPT, which is currently 12%, was frozen last year but has doubled over recent years. As well as car, home and travel insurance IPT applies to health plans, which encourage people to take a preventative approach to their health.
The research shows that 14% of HR professionals who intend to offer benefits to their employees would see their organisation removing health benefits altogether if IPT was increased, with more than half (52%) saying they would need to reduce the levels of health and wellbeing benefits they offer.*
HR decision makers from large companies (250+ employees) were more likely to anticipate a significant reduction in the level or number of health and wellbeing benefits offered to their employees next year (37% compared to 30% in small/medium organisations)*.
Yet, two in five HR decision-makers (43%) agree that employers have a responsibility to influence employee health and change their employee’s behaviours in light of pressures facing the NHS.
Our research shows that employers are aware of and, more importantly, are willing to play a key role in supporting their employees’ health. By providing health plans - which help people to see healthcare professionals quickly – as employee benefits employers are taking responsibility for the health of their workforce, and helping to relieve pressure on the NHS.
An increase in IPT would only serve to be counter-productive and discourage employers from doing so, which is why we strongly urge the Chancellor to resist increasing IPT in this year’s budget.
Simplyhealth’s research also shows that removing IPT on health plans altogether and making them exempt from the tax would have a significant impact. Nearly half (49%) of HR decision-makers state they would be more likely to purchase health and wellbeing benefits if IPT was removed. This would relieve the burden on the NHS, and ensure that millions of employees could visit the health professionals they needed to look after their health, rather than relying solely on the NHS.
Source: Total sample size was 504 UK HR decision makers. Fieldwork was undertaken between 27th September - 3rd October 2018. The survey was carried out online. The figures have been weighted and are representative of British business size.
*Source: YouGov Plc. Total sample size was 504 UK HR decision makers, 322 of which are UK HR decision makers from organisations that currently offer employees health and wellbeing benefits and are planning to offer benefits next year (199 from Small/Medium organisations (less than 250 employees) and 123 from Large organisations (250+ employees)). Fieldwork was undertaken between 27th September - 3rd October 2018. The survey was carried out online. The figures have been weighted and are representative of British business size.
About Simplyhealth
For 146 years we’ve been helping people access the healthcare support they need. Today we’re proud to be the UK’s leading provider of health cash plans, Denplan dental payment plans and pet health plans.
We’re proud to donate 10% of our pre-tax profits to health-related charitable activities every year, and this amounted to £1.13 million in 2017. Our Simplyhealth Great Run Series partnership raised an additional £42.6 million for charity.
Simplyhealth is a trading name of Simplyhealth Access, which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.