Warning of protection 'firesale' in 2011 ahead of Solvency II

Some are predicting a 5-10% increase in the price of protection products in 2013 to cover the potential cost of an HMRC tax overhaul brought on by Solvency II. The EU directive, effective from early 2013, will force changes to firms' capital requirements and HMRC will also have to alter the way it calculates its levies. Currently, insurers with both protection and investment arms are only taxed after expenses, resulting in tax relief of 5-10%, according to consultant actuary at Grant Thornton, Nigel Cooke. The I - E (investment - expenses) tax model allows these companies to off...