Last year the European Court of Justice ruled that it was discriminatory to charge people different amounts for insurance products based on their gender.
“The new rules are an early Christmas present for men,” said Michael Ossei of price comparison website uSwitch. “Women will be in for a rougher ride though, with premiums set to rise by up to 25 per cent. Hardest hit will be women aged between 17 and 25 who could see premiums almost double.”
However the ruling is set to have unpredictable effects across the industry, depending on the make-up of a firm’s existing customer base.
Adrian Webb of the female-targeted Sheila’s Wheels car insurance brand told City A.M. that there will be minimal variation to the rates his company charges because 90 per cent of its existing customers are female.
“The women who are with us already will protect the premiums going forward. It would take the best part of 10 years for the benefit to erode,” he said.
“For other companies where the male and female spread is close, the change could be much larger.”
“The reason there has been differences is the risk is very, very different – 31 per cent of dangerous driving convictions are young men,” he added.
However there is hope for women who can prove that they are safe drivers through other means, such as fitting a GPS-enabled black box insurance system.
The ruling will also affect some retirement products as insurers will not be able to take a woman’s longer life expectancy into account when setting annuity rates.