Gender ruling means higher insurance for female drivers

Published: 30 Dec 2012 10:000 comments

The cost of car insurance for female drivers aged 17-25 increased by up to 25 per cent from last Friday, December 21.

Female drivers are facing higher insurance premiums from December 21.

Female drivers are facing higher insurance premiums from December 21.

An average 18-year-old female in County Fermanagh seeking third party cover for a 2000 Peugeot could see her premium rise from £1,260 to £1,580.

An 18-year-old male would pay approximately 10 per cent less than usual, bringing the cost for the same car down from £3,717 to £3,346.

Some young females got insured in recent weeks to avoid the hike on December 21, but will face it when they come to renew their policy next year.

Young male drivers in Northern Ireland are stereotypically more likely then their female counterparts to be involved in traffic collisions and females were traditionally seen as a low-risk group. PSNI statistics from January-September 2012 show that 847 16-24 year old males were killed or seriously injured in Northern Ireland (down from 913 the previous year), compared to 705 females.

The change to the cost of car insurance follows a March 2011 ruling by the European Court of Justice that insurers can no longer charge different premiums to men and women because of their gender. It will also affect life insurance.

The UK Government and the Association of British Insurers opposed the ruling, saying it will have a negative impact on consumers. The Office of the First Minister and Deputy First Minister has said the ruling will be to the detriment of lower-risk drivers and will result in changes to insurers' underwriting practices, marketing strategies and sales approaches. Nevertheless, it must be implemented tomorrow.

"We are estimating that there will be quite an increase for young female drivers; around 20 per cent," Gordon Quinn of Brady Insurance told the Impartial Reporter.

"As a broker we try to find out what providers are offering and whether it will be better to shop around. But, certainly, there will be an increase regardless of where they go."

The average price for females will still "very much depend on what you are driving and whether you are taking out your own policy or are an additional driver on your parent's car," he explained.

Caroline Currie, Sales Director for Autoline Insurance Group, which has recently opened in Cross Street, Enniskillen stressed that "this new ruling is going to greatly impact the insurance market for buyers so it is vital the public understand what it means to them."

Telematics is becoming more popular with UK insurers as it monitors the motorists driving. Speed, acceleration and braking are noted as well as the times of the day that the cars are on the roads. This can take the form of a black-box placed inside the dashbox or a mobile phone app.

Autoline is offering the phone app, which Caroline says is a means for insurers to "allow substantial discounts for drivers." She adds: "Further discounts are available for good driving scores. Each driver has access to their score through their customer portal and drivers are given hints and tips on how to improve their score."

"The gender ruling has attracted widespread criticism," she reflects. "However it may not be a bad thing in the long-term as alternatives like telematics enables insurers to more accurately calculate appropriate insurance premiums, and for the first time the driver can influence the premium they pay by the way they drive."

AXA Direct commented that they will be "fully compliant with the EU gender directive" by tomorrow.

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