Serious doubt 'groundbreaking' proposal will achieve its aim
The industry has condemned the European Commission's decision to advance the principle of gender neutrality in the supply of goods and services. Under the proposal, using gender to calculate insurance premiums would be banned.
Anna Diamantopoulou, European commissioner for employment and social affairs, has been championing the proposal on the premise that the use of gender in setting premiums discriminates against women.
"This is a ground-breaking proposal, calling for solidarity in European society," said Diamantopoulou. "Contrary to what businesses may fear, this directive would establish a public policy decision that gender discrimination in the access to and supply of goods and services is unacceptable."
The proposal has been forwarded to the European Parliament for consultation. It will then be passed on to the EU's Council of Ministers for adoption by unanimity.
Despite Diamantopoulou's enthusiasm, the decision has not been warmly greeted by the UK insurance industry. The Association of British Insurers (ABI) is currently lobbying the proposal, stating that instead of improving conditions for women, the legislation will have the opposite effect.
Mary Francis, director general of the ABI, condemned the proposal, saying it could lead to women paying more for motor and life assurance and men having to pay more than a fair price for annuities.
"The insurance industry is opposed to unfair discrimination of any kind and we will work within whatever rules are set by Government and society. But in this case, it is only right that we point out the likely results," Francis said.
"The proposal would not help us address the real issue - how to increase women's retirement savings overall. At a time when the industry is rightly being encouraged to be more transparent and efficient, these proposals would have the opposite effect."
While insurers are confident they will adapt to the changes if they go ahead, there are doubts the legislation will achieve its aim, according to Matt Rann, head of underwriting and claims at Scottish Equitable Protect.
"The insurance industry will adapt accordingly if this legislation comes into play. But I feel the drivers behind it are misplaced and, because of that, I am not sure it will achieve its objective," Rann said.
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