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In December 2012, the EU created a law which states that insurers cannot base car insurance premiums based on gender. Insurers took into account the gender of a person, and moved the premium to suit. Men came out worse off. As they are deemed more risk to accidents on the road as opposed to women. However, in 2012, the EU tried to stop this and put a ban on discrimination of gender by insurers.
This did not just affect men’s premiums, but also women’s. On average, for young men, the insurance dropped around 10%. However, for young women, it increased around 30% to try and even out the differences.
Although this law has been in effect for 5 years, there is still a discrimination against male drivers, with them still paying more. With research showing that the gender discrimination ban has had little effect. On average the pay gap has widened between genders in the past 5 years.
Between June and August of 2017, the average policy for men was £821 and women was £649. Showing this discrimination is still present in the car insurance world.
The “loop-hole”
The way insurers can get around this law, is with the loop hole of a person’s job, states Stephen McDonald, an economist from Newcastle University. Dependant on what job you are in, will depend on your insurance premium. As some jobs are deemed riskier than others. However, insurers state that gender discrimination is not the case and premiums are based on a number of factors, yet not including your gender.
Stephen McDonald looked across six professions, 2 male dominated professions (Civil engineers and plasters). 2 female dominated professions (dental nurse and social workers). And finally 2 gender neutral jobs (solicitors and leisure assistant). Finding that the male dominant professions are at a higher premium than the females.
