The Equal Status (Amendment) Act 2012 (the ‘Act’) was introduced on 21 December 2012. The Act sought to address the ruling in the Test Achats case. Despite this Act, insurers continue to grapple with some of the issues that the Test Achats case gave rise to. This article looks at some of those issues.
The Act has provided some clarity for motor insurers on the issue of mid-term adjustments to policies that were in existence prior to 21 December 2012, but which are due to expire by 21 December 2013. Adjustments during the term of such policies should typically not be affected by the gender equality changes.
It is worth noting that the Act goes further on this issue than the Gender Directive itself. Therefore, previous decisions of the Court of Justice of the European Union (the ‘CJEU’) in the context of the Equal Treatment Directive should be borne in mind. In those cases, the CJEU decided that where the national law is inconsistent with a European Directive, a person may be held to have discriminated even though they followed the national legal requirements. While the risk may be remote, even if an insurer follows the Act’s provisions on mid-term adjustments, it is not guaranteed that the CJEU will agree with the approach.
The likely increases in premiums brought about by the Test Achats case will mean a lot of focus from policyholders. Some policyholders may claim that the changes are, in themselves, discriminatory or raise other grievances.
The likelihood of challenges to the way insurers have implemented Test Achats means there may be a future need to revisit individual underwriting and other decisions made. Appropriate operational procedures, record keeping and data storage are therefore important.
Where to next?
The judgment in the Test Achats case shows that the boundaries of equality legislation may be broader than previously thought. There has been debate about whether discrimination on grounds of age or disability could prove to be prohibited conduct. In the event of this occurring, equality legislation could effectively force companies into a community-rated insurance market.