Insurers could be forced to review underwriting practices on group employee benefit and pension sch...
Insurers could be forced to review underwriting practices on group employee benefit and pension schemes if a new discrimination law is passed by the Government, writes Kirstie Redford.
The Government recently issued a consultation paper Towards Equality and Diversity. It is proposing that two new EU directives are implemented for employment and training.
The first directive extends to include discrimination relating to age, sexual orientation, race and religion. The second directive relates to indirect discrimination, meaning that even if underwriting rules are neutral, if the effect disadvantages people, they will be seen as discriminative.
Providers currently charge larger premiums if clients are not healthy and premiums also change due to age. However, group schemes do not generally have different underwriting practices because of religion, race or sexual orientation.
Nick Kirwan, chairman of the ABI DDA Working Party and head of marketing and product development, said: 'There will hopefully not be too many issues for providers that emerge from this, but the industry needs to be aware of what is happening and maybe take a step back to ensure the directives do not affect cover.
'The only areas this should affect are group employee benefit and pensions schemes. In many ways it is good news because we would all like to live in a society where these things are taken for granted. Very few people should have problems with the principles behind the directives.'
The consultation period for the proposal ends in March 2002. If the proposal is accepted, directives will be implemented between July 2003, starting with the race directive, and December 2006, finishing with the age directive.
