Gender equality has always posed debate in society and politics. It is quite literally the biggest biological difference between humanity. Issues with gender in history have shaped how societies and social hierarchy has existed for thousands of years. As a result it has shaped social stereotypes about each gender.
Many of you would have heard comments about how ‘women are bad drivers’ and ‘men can’t multi-task’; and this may appear to have filtered down into the very integral part of our modern society that is insurance.
But, based upon a ruling by the European Court of Justice (ECJ) in March 2011, 21st December 2012 was the day all insurance providers across Europe could no longer take an applicant’s gender into account when assessing their insurance rates. This is because the ECJ felt that to offer higher premiums to a particular gender is contradictory to the EU’s wider view of gender equality.
As a result, the latest figures by a number of insurance providers revealed that in the lead up to the so-called ‘G-Day’, they experienced massive increases in insurance purchases by those trying to get the best possible deals before their rates went up.
Insurance providers Bright Grey and Scottish Provident revealed that compared to December 2011, the number of policies taken out with them rose by 25% and 27% respectively. Life policies saw especially high rises with both companies, increasing by 19% at Bright Grey and 58% with Scottish Provident. Moreover, of women buying these policies, Bright Grey experienced 52% more requests, and Scottish Provident had a massive 92% increase.
Assureweb also report the 20th December was their busiest day of application requests in their seventeen year history, receiving 786 insurance applications; the most in a single day since the company launched in 1995.
The areas affected by the legislation include car insurance, life protection, private medical insurance, income protection, and annuities (pension income). This has meant in the past months, all insurance companies have had to align their policy prices to become unisex. While many waited until the deadline to capitalise on the final rush of bargain hunters, some had changed their policies as early as November.
As policies become aligned to even the prices out for both sexes, while some prices should not change too much, other groups could see significant changes. Young male drivers, who have typically had nearly double the insurance premiums of their female counter parts, should see their rates fall. Meanwhile elderly men could see their pension income fall by up to Â£10,000 over the course of their retirement lifespan as insurance companies align men and women’s annuities.
The implications of the changes in insurance assessment could have a significant impact on the market. Companies will look closer at age, lifestyle and medical histories in order to assess premiums. This may mean that rates across all insurance policies will become higher gradually to minimise the hypothetical risk a client’s gender could have in their chances of claiming an insurance pay-out.