Insurers will have to withdraw price differentiated products from December 21, 2012, ruled the European Court of Justice (ECJ).
Insurance companies will have to radically change the pricing strategies of their health and Life insurance products along with their annuity based pension offerings.
A Belgian consumer group named Test-Achats had filed a petition with the ECJ citing the price differential on Men’s and Women’s products as a form of gender discrimination.
Juliane Kokott – the Advocate General of ECJ had said that she agreed with the Belgian group’s contention, last September.
The opt-out clause of the EU gender directive, under which insurers were able to offer differential pricing for men’s and women’s products, will cease to be effective from December 21, 2012.
The industry had been concerned about the transition period offered to switch to new requirements with some quarters expressing apprehensions of an immediate rollout, before today’s judgment.
Lifesearch has called the verdict as a “terrible mistake” arguing this will trigger product price rise across the board.
“This gender ban is disappointing news for UK consumers and something the UK insurance industry has fought against for the last decade. The judgment ignores the fact that taking a person’s gender into account, where relevant to the risk, enables men and women alike to get a more accurate price for their insurance, said Maggie Craig – acting Director General of Association of British Insurers.
“Adaptation during this transition period until December 2012 will be challenging, but all insurers will be doing everything they can to ensure as smooth a change as possible for customers”, she added.