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ABI issues guidance three months ahead of genderneutral insurance pricing

With three months to go until the European Court of Justice ban on insurers taking a person's gender into account when calculating premiums and benefits, the Association of British Insurers (ABI) has published guidance for consumers.

Gender has always been one factor in assessing risk in insurance, with different risks linked to gender being taken into consideration to calculate premiums and benefits. Women, for example, have typically benefited from lower car insurance premiums because of their lower accident rates, and men have tended to receive higher annuity rates because of their shorter life expectancy. But a ruling from the European Court of Justice in March 2011 means this will all change by 21st December 2012 as insurance pricing becomes 'gender-neutral'.

The ABI consumer guidance covers the main insurance products set to be affected by the gender ruling - motor insurance, life, critical illness and income protection insurance as well as retirement products such as annuities and income drawdown. And while people will see some changes to pricing, the ABI is urging customers not to focus on price alone, but make sure they shop around and buy products that are suitable for their specific needs.

Otto Thoresen, Director General at the Association of British Insurers said:

"Insurers and the UK Government fought for nearly a decade to retain the right to offer premiums and benefits priced as accurately as possible by considering risks linked to gender. But now that the battle is over, the industry is focused on preparing to give customers 'gender-neutral' rates that are as fair as possible.

"We know that there will be some differences in pricing and this will become clearer as the rule beds in. It is important to remember that gender is one factor of many used by insurers, and we hope our guidance will encourage customers not to focus on price alone, but think about their needs and shop around for products that are most suitable for them."

Notes for Editors

1. Enquiries to:

Adeola Ajayi 020 7216 7521 Mobile: 07725 245 284

Malcolm Tarling 020 7216 7410 Mobile: 07776 147 667

Sarah Bailey 020 7216 7514 Mobile: 07725 372636

Linsey White 020 7216 7415 Mobile: 07885 998011

Kelly Oster-Coyle 020 7216 7375 Mobile: 07968 364 302

2. The ABI is the voice of the UK's insurance, investment and long-term savings industry. It has over 300 members, which together account for around 90% of premiums in the UK domestic market.

The ABI's role is to:

- Be the voice of the UK insurance industry, leading debate and speaking up for insurers.

- Represent the UK insurance industry to government, regulators and policy makers in the UK, EU and internationally, driving effective public policy and regulation.

- Advocate high standards of customer service within the industry and provide useful information to the public about insurance.

- Promote the benefits of insurance to the government, regulators, policy makers and the public.

The UK insurance industry is the third largest in the world and the largest in Europe. It is a vital part of the UK economy, managing investments amounting to 26% of the UK's net worth and contributing the fourth highest corporation tax of any sector. Employing over 290,000 people in the UK alone, the insurance industry is also one of this country's major exporters, with 28% of its net premium income coming from overseas business.

Insurance and businesses protect themselves against the everyday risks they face, enabling people to own their own homes, travel overseas, provide for a financially secure future and run businesses. Insurance underpins a healthy and prosperous society, enabling businesses and individuals to thrive, safe in the knowledge that problems can be handled and risks carefully managed. Every day, our members pay out £147 million in benefits to pensioners and long-term savers as well as £60 million in general insurance claims.

3. An ISDN line is available for broadcasts.

4. More news and information from the ABI is available on our web site, www.abi.org.uk.


Last updated 01/07/2016