In a private letter obtained by The Sunday Telegraph, the association instructed its board members to prepare for a judgment by the European Court of Justice that using a person’s sex to calculate insurance premiums is illegal.
However, in a fresh twist, the association also acknowledged that the ruling could apply to existing insurance contracts – in a move that experts fear would immediately push up the costs of motor insurance premiums for women by a quarter.
The changes could also apply to male retirement incomes as men typically benefit from higher annuity rates than women.
In the letter, Maggie Craig, acting director general at the insurance trade body, said the judgment is expected at the beginning of March: “After careful consideration, our firm advice is that member companies should make the necessary preparations for a judgment by the ECJ that as a general principle differences in premiums and benefits in insurance contracts based on gender are illegal.
“We cannot safely determine whether the judgment will apply to existing contracts. However, we advise member companies to include in their preparations the possibility that the judgment may apply to existing contracts.”
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The UK insurance industry has feared the end of gender- specific insurance policies since receiving a legal analysis from the law firm, Slaughter and May, earlier this year
They are advised that “any attempt to influence the ECJ would be at best useless and probably counter-productive”.
Adrian Webb, a spokesman for insurer Esure, which owns the female-orientated Sheilas’ Wheels brand said: “We could soon be facing a new law that will hit millions of women through artificially increased premiums for car insurance with prices that no longer accurately represent the risk drivers actually represent.
“The fact that men and women pass their driving tests at very similar rates at age 17 but within the next three years 25 young men will be prosecuted for dangerous driving for each young woman is an indication that bad driving is
a choice, not something ingrained in gender.”
Source : The Telegraph
