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Insurance industry reacts to Chancellor's statement

Insurance industry reacts to Chancellor's statement | Insurance Business

Insurance industry reacts to Chancellor

Insurance companies have welcomed Chancellor Rishi Sunak’s Wednesday announcement of a pair of £2 billion schemes to curb youth unemployment and allow homeowners to perform green renovations.

The grants are part of a £30 billion stimulus aimed at shoring up the country’s job market and boosting the economy as it recovers from the coronavirus crisis.

A total of £2 billion in funding will be used to create six-month work placement jobs for unemployed 16- to 24-year-olds and for other government-funded apprenticeships.

“Young people bear the brunt of most economic crises, but they are at particular risk this time because they work in the sectors disproportionately hit by the pandemic,” Sunak told parliament on Wednesday.

The Treasury said the youth, which it called “kickstarters”, will be paid an average of £5,500 in a span of six months, in line with the minimum wage. With the aim for companies to pay nothing, the government will also be allocating £1,000 to administration.

Keith Richards, managing director of engagement for the Chartered Insurance Institute (CII) believes the scheme would beneficial to the insurance industry.

“A six-month spell of employment could be an excellent way for young people to discover how insurance is a vital profession where they could have a rewarding career,” he said.

“The job creation scheme must be properly integrated with other initiatives such as apprenticeships, to ensure that there is a pathway for young people from their initial experience to achieving the skills and knowledge required to be a fully competent insurance professional.”

Green housing
Sunak also unveiled the £2 billion Green Homes Grant scheme, which enables homeowners and landlords to apply for vouchers to pay for green improvements in their properties.

The government will fund two-thirds of the renovation costs, or up to £5,000 per household, and the full cost up to £10,000 for low income households.

Sunak said the grants could save some households hundreds of pounds a year on their energy bills while generating thousands of jobs for tradespeople.

The funding is part of a £3 billion green investment scheme geared at supporting an estimated 140,000 green jobs, upgrade sustainable buildings, and lessen carbon emissions.

Andy Bord, chief executive of Flood Re, welcomed the grant, which he says “will provide hundreds of thousands of homeowners with vouchers to mitigate the impact of climate change” but urged the government to include flood-prevention upgrades in homes.

“We would like the Green Homes Grant to include help for householders to install property flood resilience measures to protect their homes from one of the most severe impacts of climate change - increased flooding,” he said. “This would reduce the impact of the devastating effects of flooding for thousands of homes across the country.”