The ECJ have banned sex based pricing from Friday 21st December 2012. All forms of cover must be “Gender Neutral”.
A wide variety of insurance policies will increase by as much as 25%. The Insurance Brokers Association has said that the cost of Life Insurance, Critical Illness Cover and Income Protection could rise by thousands of pounds and Motor Vehicle cover by more than £300 a year.
Generally, women are going to be the most effected even though in the past it’s been proven they live longer and are safer drivers than Men. The equalisation of premiums mean they will pay more and it is very unlikely males will see any reduction.
The cost of life insurance may see a significant rise for Women. As Women have a longer life expectancy than men the premiums charged for this type of cover have been far lower than for Men, which will change once this new law comes into play.
People are being advised not to delay especially with any policy that may require a medical report from your GP. Insurance companies will be putting together their new pricing structures and these will go into place at the end of the summer so they are operative by the time the new rules come into force in December.
Life Cover and Critical Illness polices could rise by 25% what ever your gender. A policy that currently costs £200 per month could rise to £250. Over a ten year period there is an opportunity to save £6,000 by taking out the policy now and not waiting for the new price structures.
Tom Conner, Head of Protection at Drewberry Insurance, says, “Gender related pricing is seen everywhere in the insurance market so this really is a big change.
“It is really important not to delay any decisions on taking out long-term policies because the additional cost due to gender natural pricing can add up to significant amounts over time.
“Although the law officially comes into force in December it is likely that insurers will make this pricing adjustment a good while before then so now is the ideal time to review your protection needs.”