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The real winners and losers of the gender directive

Male and female toilet signs

Our latest research suggests that some people aren’t reaping the expected benefits of the gender directive, while others have seen insurance premiums  rocket – in some cases, by more than 50%.

The European Court of Justice’s ruling against insurers using gender as a factor in pricing products came into force last December.

But we carried out some early indicative research tracking car insurance, life insurance and annuity rates from September 2012 to January 2013, to try and see the impact of the ruling on premiums. Unfortunately, we found that all was not as it should have been.

Increases, not equality

Before the ruling happened, crystal-ball gazing predicted that premiums would equalise, but that some groups – mostly women – would end up worse off. For example, young women were expected to be about 40% worse off when buying car insurance. However, our tracking of four providers found 20-year-old women were actually 65% worse off.

Meanwhile, men of the same age were only 7% better off. This shows that, far from equalising, premiums actually met at the higher end of the market. The same was true for 55-year-olds, whose premiums increased across the board, for both men and women.

It was a similar story for life insurance. We tracked market averages for eight scenarios and found that for a 40-year-old buying £100,000 of life insurance to cover a 25-year term, premiums rose by 20% for women and fell by just 3% for men. So once again, they met way above the middle point.

And although women were the ‘winners’ in terms of annuities, with income rates for a 65-year-old woman buying a conventional annuity dropping by just 2% (compared with a 6% drop for men), our tracking seems to suggest that in the majority of cases, people were worse off.

Insurers don’t lose out

The gender directive was always going to create winners and losers, but our early analysis shows that in some cases, the only winners appear to be the insurers.  Concerns were voiced before the ruling kicked in around insurers potentially using the ruling as a chance to push premiums up, and our tracking suggests that this could be occurring. However, it’s early days – and I hope that once the ruling has bedded down, premiums may settle at more equal levels.

Whilst I accept that other factors such as economic conditions and increasing longevity may have forced insurers’ hands with pricing, there’s no denying that many people in the market for insurance are losing out. Have you seen your insurance premiums increase? If so, will you be taking measures to get a better deal?


I have to admit I have been surprised by the lack of reaction to the gender directive which fundamentally flies against the essence of insurance based on risk. If I may be so bold can I ask what whether Which? considered it a campaigning issue?

In a mad spirit of fairness and human rights I await the news that all humans no matter what their lifestyle or age will be covered for the same premium be it household, life or driving. Insulating people from true risk costs is a bizarre way of trying to make people responsible for their choices.

We are already seeing the Government trying to spread flood risk premiums across the general household insurance market rather than ban building on flood plains.or institute major flood prevention works.

My wife’s car insurance premium – just renewed with the same insurer with no changes – fell by around 7%.
As I am sure has been voiced elsewhere, this “equality” seems quite illogical. Insurance – whether car, life or whatever – is about an assessment of risk. If females present less of a risk than males, the insurance cost should be less. Can anyone tell me what I have not understood?

What a pity the Gender Directive not cover the outrageous fees charged in admin fees to both sexes when one changes his/her car.One expects to pay more insurance if the car is a higher risk&much newer and of higher value but if its same car same value 1or2years younger £41.00 is an awe-full for someone to just type a few changes.How insurers get RICH RIPPING-OFF innocent drivers.

Roland says:
19 February 2013

Is this surprising at all? Companies have a mission to maximise their profits. Anyone think companies would look out for their customers is living in fairy tales. I predicted when they said they are going to introduce this, female drivers would have their cost raised equivalent to male counterparts, while male drivers won’t see any cheaper premiums. Looks like I am pretty much spot on.,

Like the case when the government passed a law to ban debit card admin charges on air tickets, what did the airlines do? They did not just raise the admin charge to compensate, the admin charge increase was higher than the original debit card charge.

I agree with Roland. This is one of an increasing number of examples where consumer lobbying groups have actually done a disservice. Competition in the market place dictated premiums according to risk and return. The Gender Directive artificially skewed the marketplace and now most of us end up worse off.

I must be missing something, but what does the EU gender directive achieve? If, as I understand it, one group of people are less of a risk than others, then their basic insurance premiums should be lower. So female drivers would start at a lower premium than men. Similarly, women on average live longer, so would be expected to draw a smaller annuity than men for a given fund. Any interference by edict with a factual situation can only distort a market.
The insurance companies will still want to generate the same overall profit margin, so where one group wins, another will lose.
Wher is the common sense in this? Vive la difference.

In Which? March 2013, page 44: “The biggest loser is… …Before the new rules came in, we calculated that our woman was spending almost £10,000 more on car and life insurance than our man”

That should read “spending almost £10,000 less”.

It makes quite a difference to the logic of the argument.

Equality in insurance surely means equality of risk. To take a significant risk factor away – gender – simply distorts the market quite artificially. Women make smaller car insurance claims tha men, so should pay a smaller premium. They live longer, so should expect a smaller annuity for a given size fund. Where is the logic in ignoring this?
Which? Did you lobby for or against these changes?

Iain says:
31 March 2013

The EU gender directive is at odds with one of the fundamental principles of insurance – that a proposer will pay a premium proportionate to the risk they bring to the pool.
As gender is a statistically significant factor with certain classes of insurance and its removal as a factor does not create equality as people are no longer paying a premium proportionate to their risk.

TheThinkingMan says:
10 November 2015

I actually think that what I think is quite correct because what I am thinking shows that I know what I mean. I think what I am thinking because my brain is constantly thinking about the thoughts of said argument. One thinks that the majority of thinkers would think about this thought and contribute to this formal debate. Quintessentially thinking, as usual my brain is thinking about the thoughts of this thinking topic. One does think that the argument is valid because I think that this thought is corrupting in the EU thoughts.

This comment was removed at the request of the user

TheThinkingMan says:
10 November 2015

[This comment has been removed for breaking our community guidelines. Thanks, mods.]

I think. and I think this has got a bit off topic. Except what about the thinking woman? They are said to think more laterally than men and I must say I have had experience of that. Genders are not be equal.

Certainly ain’t :-))