Planet Insurance

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UK and EU deliberations on extending anti-discrimination law to goods and services are still rumbling on and lobby groups continue to press for resolution of "unfinished business".

Interestingly, although the insurance sector has concerns about the impact of any further legislation on the ability to set premiums based on levels of risk, a key reason for the slowness of the process relates to the concerns of others, such as those of the health services.

One of the fundamental goals of the EU is the prevention of discrimination based on gender, race or ethnic origin, religion or belief, disability, age or sexual orientation. However, there is no EU directive in place to deal with discrimination beyond gender or race except in employment. The UK has legislation in place covering goods and services for the other areas except for age. With age discrimination for goods and services we seem to have reached a difficult place. Why is that? Let us take health and insurance as two pointers.

Firstly, on health, some examples of discrimination raised by Age Concern are that older people do not get the same levels of services as younger people for mental healthcare; UK targets for reducing heart disease strokes and cancer only relate to those under 75; and women over 70 are not routinely screened for breast cancer. Institutionalised age discrimination is common in the health sector and increasingly regarded as unacceptable by lobby groups but the cost of changing practices would be extremely high and this gives massive cause for concern in health departments.

Secondly, on insurance, the general principles of risk assessment based on age are Europe wide. This contrasts with gender, where some countries do not use it at all and others use standard tables, which do not allow for competition between insurers. So, while many EU countries felt they could live with the gender directive the threat of a directive on age is much greater unless they can achieve some form of exemption.

So age discrimination poses bigger challenges for legislators than other areas but the problems for a new directive – and UK legislation – covering all forms of discrimination run deeper than this. The current EU and UK legislative regime has arisen over time and resulted in a hierarchy of protection. Some may argue this makes sense as a pragmatic solution to concerns for different types of discrimination. On gender, women have the right to an insurance quote and companies must publish the basis of their risk assessment but this requirement does not apply to disability where the requirement is reduced to being able to show that any risk assessment of any individual is “fair and reasonable”.

But there are powerful forces that oppose this. The UK Equality and Human Rights Commission strongly argues that the hierarchy of protection has a number of failings because it suggests that some groups are worthier than others; it is difficult for people to know their rights; it lacks clarity, consistency and coherence and it makes it difficult to tackle multiple discrimination. The Association of British Insurers, on the other hand, argues that tailored exemptions such as a hierarchy is objectively justifiable and that the gender directive should not be used as a common platform for a single anti-discrimination provision. It is likely that on healthcare, for example, many government institutions will agree with them.

So what is the current state of play? 2007 was the European Year of Equal Opportunities for All and the EU Commission used this event as an opportunity to flag up its intention to propose measures in 2008 to complete the legal framework to cover discrimination in goods and services. This took the form of a proposal for a new directive, which was issued in July 2008. This took into account survey findings that Europeans believe discrimination remains “rife” in their country, particularly when it comes to sexual orientation (51%), disability (45%) age and religion (42% each). 48% thought that not enough efforts were being made to fight discrimination in their country, such as a mandate for EU action. The responsibility for this policy area at EU level falls to the commissioner for employment, social affairs and equal opportunities, Vladimir Spidla. There is little news about recent progress. The proposed directive is currently with working groups of the Council of Ministers but there is no indication of when it might be adopted, as “difficult decisions” would need to be made.

As for the UK, the Government Equalities Office had a similar response about its plans for legislation on age discrimination for goods and services. It said that no decision has been taken on the make-up of any specific exception for insurance and the related requirements.
In summary, there is all to play for and, from an insurance perspective, a chance to gain some unexpected allies.

Richard Walsh is managing director of SPPR Consulting

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