EU plans end of gender discrimination by insurers
Insurance firms may be forced to stop discriminating on the basis of sex when new EU rules come into force.
The EU is planning to frame rules on sex discrimination, making it illegal for firms to discriminate against someone on the basis of their gender. This has prompted one commissioner to hint that the rules may be applied to insurance firms.
Anna Diamantopoulou, the European Commissioner with responsibility for social affairs, has given an interview to the BBC in which she outlined two ways in which the industry discriminates against women.
The commissioner raised the concern that women tend to pay higher prices for life insurance than men, and receive smaller pension incomes from annuities. The explanations offered for both of these problems are based on biology.
Young women pay higher premiums for health insurance because of the risks involved in childbirth, and insurance firms argue that this is why they pay less than men as they get older as these risks reduce and risks for men increase.
Insurers also claim that women receive lower incomes from their annuities because they have longer life expectancies and so the same pot of money has to last longer.
If new rules are implemented it may lead to widespread changes in insurance practices. Gender is a significant factor in other forms of insurance such as car insurance. If new laws ban gender discrimination, the perception that men are more dangerous drivers than women may no longer be a factor in deciding premiums.
