Government consults on "boy racers"

Posted: 19th December 2011

On 1 March 2011, the European Court of Justice (ECJ) ruled that, with effect from 21 December 2012, the use of gender as a risk factor by insurers should not result in individual differences in premiums and benefits for men and women.

Although the Government believes that the judgment is detrimental for consumers, it has no choice but to implement it within UK law.

A consultation document has now been published on how insurers can use gender as a risk factor in the light of the ECJ’s judgment. The document outlines the Government’s legal interpretation of the judgment, which is that it applies only to new contracts entered into after 21 December 2012 and that existing contracts are not affected. It also:

• seeks views on this legal interpretation and the accompanying draft regulations;
• invites comments on the Government’s impact assessment and requests additional data that would help better understand the impact on consumers and insurers; and
• asks for views on some of the key issues arising from the judgment, such as the scope of indirect discrimination.

The change could impact on employers who provide insurance for their staff, as it is likely to lead to a ‘levelling up’ of premiums.

See the consultation at HM Treasury website.