Dear ECJ,
There are good reasons for car
insurance
gender discrimination
Update
- 1 Mar 2011: See this article for more:
EU ECJ bans gender
discrimination in car insurance
27 Feb 2011
by Donald MacKenzie
In two days time (1 March 2011) the European Court of Justice (ECJ)
will be ruling on whether to ban gender discrinination in car insurance.
We've looked at the background to this in our blog Europe might ban cheaper car insurance for
women, and have argued against it: EU could remove
gender from car
insurance.
We recently pointed out that if young women and men are treated as one
group then young women could soon pay over
£1,000 more for car insurance.
In our last blog, we looked at contributory factors
to road traffic accidents in young drivers. Here, we look at the
gender differences for these contributory factors which support the
case for treating men and women as separate groups in calculatng risk
(and therefore premium) in car insurance. (It may help to glance at the
last blog before looking at this table).
Here are the gender differences for the factors that are most likely to
contribute to young driver accidents (taken from government national
statistics):
CF = contributory factor, listed along the bottom.
Percentages relate to how often police listed these contributory
factors for those accidents at which they attended.
The figures are for young drivers aged 17-24 years
It is quite clear from this (national) data that young women are
considerably safer drivers. They are nuch less reckless, very much less
likely to speed, better at driving suitably for the conditions, less
likely to lose control and very much less likely to drive aggressively
or impaired by alcohol.
The principle of actuarial risk assessment for insurance purposes is
that the premium should reflect each specific individual's risk. If
gender discrimination is soon to be removed from car insurance
premiums, can it not be argued that every driver, regardless of their
individual risk profile, should be treated equally?
Surely it's just as sensible to require a 40 year old (of either sex)
to meet some of the cost of dangerous young male drivers as it is to
arbitrarily impose this requirement on young female drivers.
To remove gender discrimination in car insurance is not sensible or
helpful and treats legitimate actuarial risk assessment as if it is
unfounded.
It is absurb, and yet, in all probability, is just about to be made
into law.
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