The European Court of Justice (ECJ) has done its job admirably well by ruling that taking the gender of the insured individual into account as a risk factor in insurance contracts constitutes discrimination.
The conclusion drawn from this ruling is that that young women drivers and male drivers reaching retirement age will pay more for car insurance may sadly turn out to be true.
However is does not have to be like that. The fact of the matter is that the insurance industry chooses to lump people into categories to assess risk. Hence, since taken as a group young male drivers are relatively high risk, their premiums are higher while middle-aged women pay less. Assessing risk by category is really utter nonsense. We are all individuals and should be viewed as such when it comes to insurance premiums. While some young men are safe on the road, some middle-aged women are not. Indeed my tutor at university, an archetypal 50-odd female academic, had a rather bizarre penchant for sports cars driving a succession of Lotuses, most of which were written off because she was a very unsafe driver, who still somehow managed to survive to drive another day.
The only reasonable way to work out insurance is to do it on an individual basis. There is, in addition, no requirement for insurance premiums to last 12 months. Scooter insurance has led the way here with policies lasting three months which are substantially cheaper for a new driver with a new scooter rather than a second hand one. Shorter timescales would solve the thorny problem of how to assess first time drivers. A sum could be demanded, based initially on the current category assessment, and then amended when the individual’s driving safety (or lack of it) could be worked out for that person based on their driving history. Risk assessment on an individual basis is, I am sure, a viable proposition in this age of computers.
Yes, it would mean the insurance companies changing the way they do business, but I am certain this could be achieved. In the Guardian today Maggie Craig, Acting Director of the Association of British Insurers is on the record as saying: “Insurers will now study this judgment carefully to manage negative effects for customers. Insurers will work hard to ensure that the UK insurance market remains one of the most competitive in the world offering a strong choice of products and prices for customers.”
I hope they will amend their practices to insure us as individuals with premiums based on our own behaviour not that of the group we are deemed to belong to. Yes it will cost money. However, money is the one thing insurance companies have in abundance.
Quite right that it is wrong to push people into categories and label them. I always think this when out of laziness people are described as being left wing or right wing. An individual can be against racism but in favour of small government, which clumsy designation should they be given? Left wing or Right wing?
At first the prospect of completely individualised car insurance assessments seemed ridiculous to me. The reckless teenage male driver turning up for an interview at the insurance office in his Dad’s suit and armed with testimonials from his school teachers and the local vicar. On reflection though, perhaps something of this kind might be a solution, the sums of money are so great that perhaps all the bother might be worth it.
I can’t really see the logic of saying that the ECJ had done its job admirably well but that the results would be unfair. It reminds me of when people say ‘it’s all very well in theory but it does not work in practice’. Whenever I hear this I always think that if it does not work in practice the theory must be flawed.
A similar situation occurred with the corps de ballet at the Opera de Paris. The retirement ages for the dancers were (I think) 45 for the men and 40 for the women. The decision was based not just on physical reasons but also on the fact that the men did not have the strain of dancing on points like the women. Thanks to our European masters, this was changed and the retirement was harmonised. The women had to keep dancing well after they were ready to hang up their dancing shoes and the men had to retire when they still had some spring in their step.
I suppose the EU might get around to addressing this problem in time with some top-down, ill considered bit of regulation. They will probably ban dancing on points, make the men dance on points, make all the dancers dance on points with one foot and not the other or more likely they will lead us to such financial catastrophe that all ballet dancers will be hobbling around the stage in their late nineties.
God what absolute rubbish! Have you never heard of actuarial tables?
Yet again EU afiliated & unaccountable bureaucrats are meddling with things that don’t & shouldn’t concern them.
Oh to be French & to have a government that just ignores anything (like this) that isn’t in the national interest.
Why can’t we just say “no”?
The trouble with the ECJ attempting to apply anti-discrimination principles in relation to insurance and annuities is that statistically the sexes are manifestly biologically unequal. Either costs rise for most folk or dubious proxies are found that amount to gender filtering by stealth. Life expectancy exhibits closer correlations to gender and social class than it does to smoking! If it is wrong for insurers to consider someone’s gender, what about her/his mosaic category? Ultimately insurance is ABOUT discrimination. Some things and people are literally uninsurable (you are no doubt aware of the number of Londoners who are effectively unable to visit the US because they can’t purchase medical insurance at a sensible price).
There are exceptions to gender discrimination legislation – personal insurance ought to be one. Indeed it is rather disturbing that the ECJ is trying to apply human rights and equalities principles to it at all.
Just for a few seconds, I thought this was going to be a sensible post. But no, it’s another politicians trying to tell private companies how they ought go about their business.
As Dave Collins writes, “Insurance is ABOUT discrimination.”
Okay, Ms Honeyball, let’s play it your way. As a 47 year-old man, I should be able to pay the same premiums for life insurance/assurance as an 18 year-old woman. A smoker should pay no extra. Medicals should not be required, because they are bound to discriminate against those who are unwell.
And as for paying different house insurance premiums depending on where you live, why it’s a postcode lottery!
The state of our economy is hardly surprising considering the red tape and other interference from all sorts of elected and unelected busybodies.
No offence, but the sooner we get out of the EU and you have to try and get a job in the real world the better.
Stewart Cowan, you have really not understood what I am saying. My view is that it is unfair to categorise people by groups, which is what actuarial tables do. People should be assessed for risk on an individual basis as risk is individual. Insurance companies do this is some cases such a smokers to whom you refer. In the modern era where all insurance records are computerised, this is possible and would provide the consumer with a much better product.
Mrs Honeyball,
You wrote, “Assessing risk by category is really utter nonsense. ” I don’t think you can assess an individual like you suggest. Buster Martin died this month aged over 100 (his exact age is disputed). He smoked from the age of 7 to the day he died – he was fit up to the very end. He was known as the UK’s oldest employee. He was clearly much fitter than most (every?) non-smoker, yet he would have been penalised for being a smoker by the insurance industry – discriminated against, if you like.
If women have fewer accidents than men then let them have lower premiums. What is the problem with that?
The ECJ has proved that “equality” and fairness are totally different, although this has been obvious to a lot of us for some time now as we read the almost daily news stories of fairness and justice being dispensed with because of this weird devotion to “equality”.
Men and women are NOT equal. Women are safer drivers. Men are stronger. Women bear children. Men are natural providers. Women are natural nurturers.
The sooner politicians realise that men and women are complementary, not equal, we can maybe move into more enlightened times again; happier days.
We are equal in the eyes of God and deserve equal treatment in law, but not every human being is equal in talents and abilities and “equality” legislation is doing a lot of damage because it can fail to recognise this and certain freedoms become sacrificed and people can feel they have been relieved of their responsibilities.
I’m afraid the pan-European organisations no longer know what justice is in their rush to kill freedom of conscience, freedom of speech, individuality, freedom of religion, national sovereignty and nationhood.