Blog: The Brussels Effect - Six Months On

Today marks the six month anniversary of the implementation of the EU Gender Directive. Do you remember that momentous day in December last year? The day on which the EU legislators in Brussels decided that insurance companies could no longer use someone's gender as a key factor when setting rates for a wide range of policies - including life and car insurance. Well anniversaries usually get celebrated in some way and for many of Britain's younger male motorists the bunting may well be up and the alcohol-free lager on ice. They have been the unwitting recipients of the EU decision to discount years of actuarial insurance knowledge in one fell swoop. Compared to a year ago, using data sourced from our monthly Tiger Watch car insurance price monitor, many young men have seen their premiums plummet. We estimate that car insurance policy prices for a 20-year old man could have dropped by around 14%. And 25-year old blokes could have fared even better, with prices down by around 25%. But whilst the nation's motoring males are counting their blessings, Britain's young women drivers are counting the cost. The EU Gender Directive has had the opposite effect, increasing premiums year-on-year by around 25% for a 20-year old. In the old days - well, a year ago - young women paid less than young men for their car insurance because they presented a lower risk to insurers. They still made claims on their policies, but those claims tended to cost insurers a lot less to resolve than those of their young male counterparts. This factual basis for lower car insurance prices for young women was essentially swept aside by the EU legislators last December, with UK insurers forces to ignore gender when setting prices. Here in the offices we've discussed this at length and can't see any fairness in the way that the legislation undoubtedly financially penalises young women drivers. What do you think?
21/06/2013 09:00:32 Eren

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