Is it sexist for the insurance industry to take gender into account when setting its premiums?

The sexual habits issue only applies in the situation of a homosexual man looking for health insurance and I think that is the law as it currently stands. Certainly a gay man can't be denied insurance or charged more simply because he's a man, the insurer has to ask follow on questions if they want to go down that route.

I don't see any need for intimate questioning in any other scenario. Your profession and how long you've been driving are fairly inocuous and easy to prove if anyone is tempted to lie.

oops, sorry, got carried away with the surelys

Surely rather than discriminating on a protected characteristic, insurance companies should ask for more relevant details instead.

So, going back to the example of the gay man looking for health insurance, it is illegal to charge more just because he is gay and therefore at greater risk of HIV. Instead, the insurer needs to ask about relationship status and safe sex and get to the root of the issue. Surely everyone agrees this is the right way to go.

Same with race and health insurance. You cannot charge someone more based on race but you can ask about specific diseases that are more prevalent in certain groups. Again, sounds fair.

Surely, we should go the same way on sex. If women are less likely to suffer from certain health issues, is it because they are women or because they don't drink too much, eat heathily and are less likely to smoke? If so, just ask those questions instead and price health insurance and annuities on that basis instead?

Same with driving. There are other questions you can. So DH has never had an accident in 20 years of driving. He's naturally quite risk averse. He's an accountant too. His profession is a good indicator of his risk aversion. His lack of accidents is probably related to his aversion to risk.

For age, why not use years of driving experience instead? I don't that was a factor at all when we last renewed our car insurance, but surely there's a correlation here.

The only example I can think of where this doesn't work is where the protected characteric is a cause of the higher payouts. I'm thinking that someone with a disability is likely to have higher health care costs as a direct result of their disability.

SardineQueen - I think that if a type of discrimination is considered unacceptable by society - and is prevented by law in some areas then it should also be in other very similar areas.

Yes, car insurance for women would go up (and men down) if we didn't discriminate. But I don't think it would spell the end of for-profit insurance, any more than equality employment laws put all small companies out of business.

I am going to bed soon though.

Finding this really interesting

I'm just really keen to know whether the people on this thread who want sex taken out of the equation for motor insurance, want it taken out of the equation for annuities.

And if not, why not?

Sorry for multiple posts...

So ratehr than the premiums ending up in the middle, some young men's premiums would come down to similar levels to females, the occasional female would go up, and a whole load of men would be barred from driving entirely.

I'm not sure that's teh result the people going to court are looking for!

And in a way its still "sexist" isn't it? Because the likelihood is that a person with very high testosterone is going to be a man. So we're back where we started.

Would it breach some kind of human rights or something though? Is it ethical? You would be "condemning" men with high testosterone to no driving for life...

I know that insurers have held back from doing genetic testing in medical underwriting because of various possible ramifications, this strikes me as similar.

suchprospects yes - if testosterone is the reason for it, blood tests would be a logical way forward.

I can see a few problems with it though - would the motoring public opt for a policy where they had to go for a blood test or one where they didn't? I don't think it would go down very well!

Also men with high testosterone would potentially be declined insurance for life. I can forsee problems with that too.

Plus we don't actually have teh evidence that that is what is causing the crashes.

But on principle, yes, works for me!

I wasn't saying that age is appropriate to use. I was saying that it may or may not be and would need considering.

HerBex - I thought age discrimination laws still allowed some employers to discriminate in some ways - there's a different minimum wage for under 21s for instance. There are some things you aren't allowed to do until certain ages, etc.

SardineQueen - if testosterone is the reason then insurers could set premiums based on testosterone levels perhaps.

cakeretention do you feel the same way about all insurances, and about all risk factors?

Are you keen for "for profit" insurance to end and for the state to take over on lines which are seen as necessary?

If that is the case then I agree that your argument has merit.

Interestly women are routinely paid less than men for the same job. So I'm not sure where that gets us

The easy way to get round your problem cakeretention, is to introduce properly paid paternity leave at the same rate as maternity leave. Then that way, both sexes would be equally likely to take time off. Problem solved.

Yes legislation which prohibits discrimination on age is in place. The insurance industry are however allowed to take age into account when setting premiums as they have convinced the legislators of the need for it, just as they did with sex.

TBH age is more of an issue than sex for insurers, by far.

Still I think if it's one in, all in. You can't pick and choose.

SardineQueen - I could easily avoid the "individual level" by posting a job that offered a lower salary to any woman applicant because she might take time off - again clearly unacceptable. To me this remains very similar to what the insurance companies are doing.

The government use these types of statistics when planning for the future and allocating funds. How many school places, how many maternity places, how much money in the pot to recoup employers for maternity pay, that type of thing. You can see that has some value, and is not sexist, I'm sure?

If people don't like the system then it can be changed - we'd just need to pay a fixed premium of some sort to the state, and the state would provide fixed benefits in return. What you can't do is take an industry that is based on risk and probability, and tell them they are not allowed to calculate risks or use probability. There are only a finite number of characteristics that people have. Take them away and you can't calculate the risk.

If that is what people would like to see that is a reasonable position. What I cannot accept as a reasonable position is that this single pricing factor in this single insurance line is a huge problem, but all other insurances and pricing factors are fine. That is not a logical position.

In what way is age not a protected characteristic?

It is in employment law now.

Is car insurance to have its own set of protected characteristics, separate from everyone else's?

cakeretention because as an employer you are actively discriminating against that individual. You are looking at them and their experience and deciding not to hire them because they have the potential to have a child.

When insurers set their underlying rates they are not doing it at individual level, they are taking attributes of entire groups and applying them across the board.

It is reasonable and factual to say that in a statistically relevant group of women a certain % will give birth in the next 5 years.

It is not reasonable and factual to look at one individual woman and hazard a guess as to whether she will have a child in the next 5 years or not (and invariably decide that she will).

suchprospects I am sure there is some evidence that the testosterone levels in young men make them drive aggressively and take risks.

How is that different from you idea that there is some evidence that the brain is still developing until the age of 25?

So, as an employer, I can see that a woman is "statistcally likely" to take more time off work (to have a baby) than a man. There is a clear correlation there. So by employing a man I am taking a lower risk than employing a woman, reducing my costs and benefitting my customers. But basing any sort of employment decision on such a correlation is quite rightly unacceptable.

Why on earth should it be any different for car insurance, or any other situation in which gender could influence a financial decision?

So you want to pick and choose which characteristics can be taken into account, for which insurances.

Would you want sex to be taken into account when people are buying annuities?

HerBex - If that's aimed at me I was saying that young men would pay less (on average) and young women would pay more. As the risks are aggregated so are the premiums. I would think you would see, at least initially, a slightly higher overall average rate.

Discriminating on age grounds - There is evidence that our brains are still developing (esp judgment) until around 25 so there may be grounds there. Or not. But age isn't protected in the same way that some other characteristics like sex and ethnicity are (and it isn't the same sort of characteristic) so I don't think it's a straight comparison.