Archive for November 2008

Thanks Gordon Brown – Xmas is back on again

We don’t usually have very good things to say about the macro-economic programs espoused by Mr Brown, however being mates with some of his mates may help spread the word of discontent.

Anyway, Today it’s Thanks, not for recently agreeing the BOE base rate cut which is by not enough by far (TLTL), but for sticking it up the Lenders by insisting that they pass the cut on to us Joe Public.

Today I’ve seen £600 slashed off my mortgage repayments – it might be the bleak mid winter but if other people are feeling as good about this as us, then maybe we won’t have to follow AIG and cancel Christmas. Happy Shopping!

Government take two thirds stake in RBS Insurance

The government been forced to take ownership of 57% of Royal Bank of Scotland after it’s own shareholders took up on just 0.24% of its capital raising.

The government will pay £15bn for the majority stake in the troubled bank and £5bn in preference shares following its bid of the UK’s biggest bank bail-out.

This bail-out will leave the long suffering taxpayers with an instant paper loss of £2.3bn, as RBS shares have recently been trading at a much lower share price than the 65.5p offer revealed last month.

In a bid to increase value for taxpayers and stop future politicians making business decisions about the running of banks, the government’s shares will be held by an independent UK Financial Investments Ltd. (Who are they?)

According to the newswires RBS has been trying to flog RBS Insurance all year to raise £7billion, prior to the banks recent troubles!

As part of The Royal Bank of Scotland Group, RBS Insurance is one of the largest general insurers in the UK, employing over 18,000 staff and incorporating many of the highest profile household names in the business, including Direct Line, Churchill, Green Flag and Privilege, amongst others.

UK Budget – If thats Radical I’m Obama’s Change

Well we’re pretty disappointed here at Insurance Blog in Mr Brown’s, sorry Mr Darling’s ‘Emergency Budget’ efforts yesterday. The £2.50 change to VAT is really going to get noticed in a market where January Sales started in November.
Balancing the so called give-aways against threats to tax the not-so-very-rich rich, is hardly helpful or forwardlooking.
Now radical would be raising the 40% tax limit from £38,000 to £60000 and maybe, reducing the rates and doubling the limits of Stamp Duty – helping to stimulate the housing market bottlenecks created by the middle classes where most of the debt and strangled liquidity lies!
Oh yeah stop wasting money on stupid wars might help the Balance of Payments just a little bit maybe!!

Anyhow did anyone notice if there were any changes to the levels of Insurance Premium Tax?

IPT is the tax on premiums received under taxable insurance contracts.
Currently there are two rates:
• a standard rate of 5 per cent
• a higher rate of 17.5 per cent (

All Insurance Contracts in The UK are
taxable unless they are specifically exempted .

The following insurance contracts
are exempt from IPT:
• reinsurance;
• life insurance, permanent health insurance and all other “long
term” insurance except medical insurance;
• commercial aircraft and some associated liabilities;
• commercial ships and some associated liabilities;
• lifeboats and lifeboat equipment;
• foreign or international railway rolling stock and some associated
liabilities;
• export finance;
commercial goods in international transit;
• block insurance policy held by Motability which covers all
disabled drivers who lease their cars through the scheme;
• risks located outside the UK; and
• the Channel Tunnel.

What is the higher rate of IPT?
The higher rate of IPT is 17.5%. It applies to insurance sales in three trading sectors
where insurance is sold in relation to goods and services which are subject to VAT:
• sales of motor cars, light vans or motor cycles
• sales of electrical or mechanical domestic appliances (warranties)
• sales of travel insurance.

Surely then the higher rate must be decreased in line with VAT?

Let us know!

Credit Card Insurance is Essential in Credit Crunch

In a recent press release Sara-Anne Burgess of Burgesses highlighted the dangers of not having adequate or possibly no credit card protection insurance.

As important as all your other monthly outgoings, have you considered how you are going to pay all your credit cards if you suddenly lose your job and become unemployed? Are you aware of credit card payment protection insurance?
At least you will have to struggle to find the minimum interest repayment. What if you can’t find a job that quickly?
The BBC Panorama program recently highlighted the plight of homeowners houses being repossessed for unpaid credit card debt. You can avoid this happening to you for very little if you buy through independent credit card protection insurance and lifestyle protection insurance specialists such as Personal Accident and Safety First

Car Insurance Online – Forget It

We know many of our Insurance Broker friends in the UK are struggling to sell their excellent car insurance products online.
In many cases they have spent a fortune on integrating their back office systems, which hold the rates for comparing prices and all the customer and policy information, with their smart new expensive website.

One year down the line the website still looks shiny and new, mainly because nobody ever goes there!

Why? Well to be successful on the Internet you have to be visible. This means all the major search engines have to list your car insurance website, in particular Google.

Well getting a listing in Google may take you years and you’ll never going to be able to compete with all the big boys and their massive marketing budgets that dominate the search results.

So what other options are there?

Well Google allows you to buy a link on their home page for different keyword searches for example ‘car insurance’

And they’ve very kindly created a tool which will help you see how much its going to cost you to get a click through from Google for the search term ‘car insurance’.

You can find it at Google Adwords Keyword Per Click Estimator

If you type in car insurance and set the currency and location to GB, you can see exactly whats its costing the large aggregator sites that dominate the front page paid listings in Google:

Heres the results for Car Insurance – GBP – UK for positions 1 to 3 on Google

Average CPC: £15.40 (at a maximum CPC of £33.65)
Estimated clicks per day: 1,091 – 1,367 (at a daily budget of £25,270.00)

Wow! These guys must be spending a fortune with Google when you think about how many thousands of keywords they bid on!

So we tried out another very competitive keyword in the current economic gloom, namely income protection insurance:

Average CPC: £5.82 (at a maximum CPC of £12.20)
Estimated clicks per day: 5 – 6 (at a daily budget of £50.00) Hmm not too bad!

how about Income Protection?

Average CPC: £5.19 (at a maximum CPC of £10.04)
Estimated clicks per day: 15 – 18 (at a daily budget of £110.00) – very interesting!!

What about long tailed car insurance keywords like specialist car insurance

Average CPC: £9.92 (at a maximum CPC of £15.86)
Estimated clicks per day: 0 – 1 (at a daily budget of £15.86)

Well there you have it at – Around £10 per click even for car insurance keywords that aren’t even searched for much.

The future of the small independent car insurance broker online looks bleak.