Warning of rise in car insurance premiums
August 20, 2012
Insurance costs could rise next month by 15 per cent in response to a European ruling, the director of a financial firm has warned.
Greg May, director of Flower IMA Financial Services, said the new EU Gender Directive, which comes into force at the end of the year, will see insurance companies adjust premiums from September.
Mr May said: “Ignoring gender in many cases leads to more losers than winners. For example, young female drivers have a statistically lower risk of crashing than their male counterparts, and so insurance premiums have historically reflected this and charged them less.
“But from the end of this year, this fact will not be taken into account, despite the fact that car accident figures are not discriminatory – they are gender neutral and are purely documenting the truth.”
Flower IMA, part of the Romans Group with branches in Wokingham and Crowthorne, is also warning life assurance will be affected.
Mr May continued: “The effects of gender-related illnesses will no longer be counted, and nor will the fact that women live longer than men. That means critical illness and life assurance cover will become more expensive for women. Meanwhile, income protection for men will also cost more, because historically they had a lower claims record – and thus cheaper premiums – than women.
“We are strongly advising customers to review their insurance well before the end of the year – industry pundits predict that many existing premiums will start to rise by approximately 15 per cent during the autumn.”