New gender rule to hit insurance customers

 

Simon Read
Friday 21 December 2012 15:30 EST
Comments
The ruling has led to rises in the cost of female rates
The ruling has led to rises in the cost of female rates (Alamy)

Your support helps us to tell the story

From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.

At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.

The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.

Your support makes all the difference.

A European Court of Justice ruling came into effect yesterday that makes it illegal for insurers to sell policies which calculate premiums based on gender.

The ruling has led to confusion among providers of motor cover, life insurance and annuities, all of whom must now avoid calculating prices based on gender.

Simon Douglas, director of AA Insurance, warned: "Insurers are stepping into the unknown.

"It has led motor insurers to reassess how they take other aspects of risk into account – such as their age, occupation and postcode, as well as the model of car they drive."

However, despite warnings that female motorists could be hit by soaring premiums, Mr Douglas said the difference will be less than anticipated.

That's because car-insurance premiums are falling while legal changes due in April, including measures to control whiplash-injury claims, will reduce insurer costs, allowing them to cut premiums further.

When it comes to annuities the impact is also less than expected, judging by a report from Legal & General.

The insurer said that its introduction of gender-neutral pricing saw a reduction in male rates of around 3 per cent and a rise in female rates of 3.2 per cent.

Tim Gosden of L&G explained: "Gender is only one factor that we use. Other factors such as health and lifestyle can have a much greater impact on life expectancy."

Join our commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in