Cost of life cover for women up 25% after gender ruling

The cost of life insurance has jumped by as much as 25% for women, as a result of the EU gender directive.

According to a study carried out by Caledonian Life, the cost of premiums in life and mortgage protection cover for men has dropped over the last five years across the board. However, the cost of premiums for women has risen by as much as 25% in the same period

This is due to the impact of the EU gender directive, which came into force in December 2012 and states that premiums and benefits should not be different between two individuals for the same insurance policy, based solely on their gender. This had been one of the key bases of pricing life cover in the past.

Rachel Purcell of Caledonian Life said: “It would clearly appear that the gender directive has had the impact that was expected when it was instituted. Both male and females now pay the same price for life cover. Unfortunately for females, that has meant an increase in what they would have had to pay for the same policy in the past, up to 25% more in some cases.”

For example, a 30-year-old female non-smoker would have paid €12.12 a month on a €300,000 mortgage protection policy in 2009. However, last month, she would have been quoted €15.15 a month, an increase of 25%.

In contrast, a 45-year-old male non-smoker would have paid €71.63 a month on a 25-year life assurance policy in 2009. This has fallen 28% to €51.23 a month.

Ms Purcell said the data revealed a mixed outlook for consumers — with males have definitely fared better in recent years with marked reductions in the cost of both life assurance and mortgage protection.

“However, the public should remember that life cover is still extremely affordable, and much cheaper than they may expect.

“In fact, €240,000 worth of life cover is available from as little as €15.15 per month for 20 years, for a 30-year-old non-smoker. That’s under €4 a week, less than what some people spend on coffee every day.”

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