New tax – will insurance become more expensive from 2026? What is important for residents to know?
The Seimas of the Republic of Lithuania adopted an amendment to the law, according to which from January 1, 2026 All non-life insurance companies operating in Lithuania will have to pay a 10% security contribution tax on the total amount of insurance premiums for concluded, extended or amended contracts. This obligation will apply to many types of insurance, including home insurance, CASCO (voluntary car insurance), travel insurance, etc.
Which insurances will not be subject to the tax?
The tax will not apply to MTPL (compulsory third party liability insurance) contracts concluded by individuals – this is a significant exemption for many private drivers. However, it is important to know that if the vehicle insurance contract is concluded by a legal entity (company), then the tax exemption does not apply, so both cars insured by companies on sharing platforms and public transport vehicles will be taxed.
What does this mean for private persons?
Although the tax will be paid by insurance companies, it will become an additional financial factor that insurers will have to take into account when calculating their operating costs. There is a high probability that this burden will be passed on to end users. Therefore, it is important to know what aspects may affect your insurance premium and what you can do to maintain adequate protection at a reasonable price.
How to choose insurance responsibly: practical tips
- Assess the main risks
First of all, it is worth delving into which risks can cause the greatest losses – for example, in home insurance it can be fire or flooding, in car CASCO – accident or theft, in travel insurance – medical expenses abroad. It is important to choose protection according to your real needs. - Consider your deductible
Choosing a higher deductible (i.e. the amount you pay yourself in the event of a claim) usually results in a lower premium. This can be a good option if you want protection against major risks but don’t want to be tied down to small claims coverage. - Use security measures
In some cases, additional security measures can reduce your premium. For example, in home insurance, an alarm system, smoke detectors, fencing or surveillance cameras. - When insuring a car – evaluate the drivers
The insurance premium can be affected by who will be driving your vehicle. By properly selecting the age and driving experience of the youngest driver, the premium can be optimized. - Use comparison tools
The pricing and decisions on insurance terms applied by different insurers may vary, so it is useful to use independent platforms (e.g. Man Ramu Insurance Platform) that help you evaluate possible options objectively. - Plan ahead
Insurance premiums can fluctuate depending on the market situation and the terms you choose. Plan your annual budget in advance and review your current insurance contracts a few months before they expire – this will give you time to evaluate the new terms and choose the most favorable offer.
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