Insurers should be allowed to discriminate

I don’t think that men should pay more for car insurance than women simply because they are men. I think that any group statistically more likely to be involved in an incident should pay more for their cover.

But from December insurers will no longer be able to use gender to assess risk. Simply put, they won’t be able to charge men more than women, even though young men are a far higher risk than their female peers.

New analysis from Gocompare.com suggests that, when the ruling takes effect, women drivers face premium hikes of £300 on average. Young female drivers could pay as much as £2,000 more a year, as they subsidise the premiums of far riskier young male drivers.

Insurers should be allowed to use hard facts when setting premiums

I’m not trying to ignite a battle of the sexes; I have no strong opinion on which sex is best behind the wheel.

But I do strongly believe that insurers should be allowed to use hard facts when setting premiums – and here are the hard facts:

Male drivers under the age of 22 are reportedly 10-times more likely to be involved in a serious crash than their female counterparts. Insurance claims made by young men are an average of three-times higher than those made by 30-59 year-olds, according to the Association of British Insurers.

Government statistics show that male drivers under the age of 25 have the highest incidence of failing breath tests following road crashes where someone has been injured.

The income a man receives from his pension could fall by as much as 8%

And if you’re a man who thinks this ruling is fair, you should know that it is going to hurt you too.

Currently, men buying an annuity with their pension pot get more for their money than women. That’s because they tend to die younger, so it makes sense to give them a larger annual payment.

But the gender equality ruling means that’s no longer allowed. The Association of British Insurers estimates that the income a man receives from his pension could fall by as much as 8% - meaning many will be hundreds of pounds worse off a year.

Insurers charge more for individuals at higher risk, so that lower risk customers aren’t paying a disproportionate amount for their cover

What can we expect next from the EU court? Perhaps it might decide that ageism is unfair within insurance; that makes about as much sense as gender.

That could mean that 25-year-olds and 80-year-olds would pay the same for life insurance.

Insurers charge more for individuals at higher risk, so that lower risk customers aren’t paying a disproportionate amount for their cover. That’s fair, that’s how the system works. The whole point of insurance is that it discriminates against the risky.

• Felicity Hannah is a personal finance journalist living in the north of England.

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