EU laws under threat over lower premiums for women

IN a move towards greater equality that will not be welcomed by the fairer sex, insurance companies could soon be prevented from the age-old practice of offering women lower life and car insurance.

Two men and the Belgian consumers organisation, Test-Achats, have challenged EU laws that allow insurance companies to charge men more for both types of insurance.

Under existing practices companies are allowed to differentiate on the basis of gender, but only in as far as they can prove statistically that there is a difference.

They argue that figures show how women have fewer and less serious driving accidents and, if they do get their car damaged, are less likely to claim on their insurance.

They also point to the fact that women tend to live longer than men and that this too should be reflected in different premiums for life insurance policies.

Under EU law, however, the principle of equal treatment of men and women must be strictly adhered to and that differences in gender can only be justified on the basis of a clearly demonstrable biological difference.

The chief legal adviser to the European Court of Justice, Juliane Kokott, has suggested, however, that the difference is not only or overwhelmingly because of gender, but because of a range of other factors.

She insists, in her preliminary opinion on the court challenge, that life expectancy and health, for instance, are more dependent on social status, education, occupation, eating, drinking and smoking than whether you are a man or a woman.

The European insurance federation, CEA, has warned of “far-reaching implications for the price and availability of insurance cover” if Ms Kokott’s opinion is actually adopted by the court.

“Premiums will increase, coverage will decrease and some products will be withdrawn from the market entirely. Insurers must be able to calculate their premiums in a fair and sustainable way, using all relevant factors,” said CEA head Michaela Koller.

She added that insurers do not discriminate, just differentiate.

Insurance companies generate over €1,050 billion a year in income throughout the EU and employing more than a million people.

Final judgment in the case is not expected until next year.


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