With just over a month until the deadline for insurance benefits and premiums to be gender neutral, the insurance industry is making final preparations for the change.
From 21 December 2012, insurers will no longer be able to use gender as a factor when pricing insurance contracts. This is because of the Test-Achats ASBL v Conseil des Ministres (Case C-236/09) ruling by the ECJ in March last year, which set 21 December as the final date for implementation of the ruling (see our previous blog here). The changes will affect all insurance products that factor in a customer's gender, with the biggest impact expected on motor insurance and retirement income products such as annuities and life insurance.
In recent developments, the Association of British Insurers (ABI) has issued a series of guidelines for the public on how the gender ruling may affect them. The ABI says it expects premiums to be affected as a result of the change. It states that women may see their motor premiums rise, but may also benefit from receiving higher payments when purchasing retirement income products. The guidelines can be seen in full here.
Meanwhile, insurers are adjusting their systems to offer unisex pricing by 21 December 2012 in order to make sure the change is as smooth as possible. Several large insurers have issued their own guidance notes to staff and brokers, and in recent weeks there has been widespread publicity in the press. Nonetheless, more than a quarter of drivers are still unaware of the upcoming changes, according to a survey by motor insurer AA Insurance published on 12 November.
For details of the UK Government's response issued in July, expressing criticism of the Test-Achats ruling and predicting a negative impact on consumers, please see our previous blog here.