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European commissioners have
voted unanimously to push through proposals that
could prevent UK life offices from pricing
annuities and life products on grounds of sex.
The proposals for removing
sex discrimination in financial services - driven
by EU social affairs commissioner Anna
Diamantopolou - could result in reduced annuity
payments for men and higher motor insurance
premiums for women.
The ABI has questioned
whether the move would benefit women. Its figures
show that women could expect to pay £2,000 extra
in motor insurance throughout their lifetime or
£500 more for life cover. Women with a pension pot
of £10,000 would increase their annuity income by
only £3 a week.
But Diamantopolou's office
says it is unfair to focus underwriting on sex
when other factors, such as marital status and
area of birth, have a greater influence on
longevity.
The EU says it wants to allow
a six-year transitional period to give insurers
time to gather data to allow them to underwrite on
new factors.
ABI spokeswoman Emma Grainge
says: "We will continue to voice concerns over the
unintended consequences of this draft directive.
This initiative is designed to tackle female
pensioner poverty but the answer has to be to
encourage them to develop bigger pension pots, not
removing gender as a factor in annuity rates."
European Commission social
affairs spokeswoman Antonia Mochan says: "We are
not saying everybody has to receive the same, we
are just saying you cannot underwrite on grounds
of sex. There are many other factors that
determine risk and we are proposing a six-year
transitional period so product providers can get
in place the new actuarial tables."
John Greenwood
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