Under insurance ruling, young men get a break in Europe
The European Court of Justice has ruled that insurance companies cannot take gender into account when charging premiums and giving benefits. This includes auto and life insurance; young men cannot be charged more than young women for car insurance, as Stephen Beard explains.
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STEVE CHIOTAKIS: A decision by the European Court of Justice has left insurance companies on the continent reeling. The court ruled that men and women must be treated exactly the same. As in charged the same premiums for insurance policies.
Marketplace’s Stephen Beard reports.
STEPHEN BEARD: “Utter madness” said one member of the European parliament. “A setback for commonsense.” He was reacting to the latest ruling from the European Court of Justice. In Europe insurance companies use gender to assess risk. They do the same in the United States. But the European court has ruled that breaches EU rules on gender equality. This means that insurance companies here will no longer be able to charge higher car insurance premiums to young men, even though — statistically — they are more likely to drive dangerously and have accidents than young women.
Malcolm Tarling of the Association of British Insurers deplores the ruling.
MALCOLM TARLING: Gender has been an important risk factor that insurers take into account for many years. And it’s enabled us to set premiums that accurately and fairly reflect the risk.
He says the judgement could also mean that women will pay higher premiums for life insurance even though they are statistically likely to live longer than men.
In London this is Stephen Beard for Marketplace.