Insurance after the 1st of October

yep, i'm with AMI for my contents insurance and had a letter from them on friday saying that the premium was going to go up in october....i also watched fair go and was like huh?? so i am a bit confused about that lol. yeah its not by a lot that it goes up by, like $2 i think per month...but if it isnt supposed to go up until the anniversary are they in the wrong?

Basically it isn't clear cut, it depends on the company and the policy.

Insurance companies have the option to pre-pay GST. If they had prepaid the GST for your annual premium they wouldn't pass on the GST increase as they have already paid it at 12.5%. If they haven't prepaid they can pass on the increase, some companies have and some haven't.

If your company is going to pass on the increase the only way you can get out of it is to pay your total annual premium owing before 1 October.

It is slightly more confusing than that but I've tried to make it understandable. As usual the fair go program was a little off the mark, not surprising given their general hatred of insurance companies.

Stacey you are right, they would have had to inform you in writing. I use a variety of companies, UniMed and AMP have passed on the increase, State doesn't seem to have. All policies are paid monthly. (Axa has also absorbed the increase I believe)

Oh, also it pays to note you don't pay GST on straight life cover, so if you just have life insurance (with no added trauma, crisis etc) there is no GST payable on the premium hence you wouldn't have got a letter.

Edited by clover