MSE News: Insurance costs to soar as gender discrimination banned

Cricri

Moronic law, plain and simple. Politicians and judges keep pushing political correctness beyond reason and hurt the consumer in general, you'd think they'd get a clue (but for that, they'd need not to be dumb). Either that, or insurances lobbied (read "passed wads of cash") to push a policy which will make them a fortune.

Insurance premiums are based on statistics. Men like me have statistically more accidents then women like my wife, and thus it is normal that my premium is higher. Now what it means is that I won't be paying less, but she'll be paying as much as me, and since I pay the bill...

What's next: a Ferrari owner paying more than a Yaris owner like me is discrimination? The owner of a 200 years old house on the edge of a cliff in a seismic active area at the foot of a volcano paying more house insurance is discrimination? And how about preventing child labour is violating their right to find work? And sex education against the right of teens to get pregnant at 13? And shouldn't hammers be banned for causing grievous harm to nails? And more seriously, surely the "young driver" and "no claim bonus" arguments are going to get scuttled as well?

"From now on, I want you all to call me Loretta, and I want the right to bear a child". It made us laugh 20(? don't know) years ago, but now it's not a joke anymore. "The life of Brian" should be reclassified as drama documentary.

ironmancole

How do you stop once you've started something like this? For example, I'm 36 now and been driving for 14 years accident free but remember the costs when I was younger for even a third party policy.

Are all the young drivers (who like it or not are still a greater liability on the roads until maturity and experience kick in) going to go to the EU and demand that their age should not be factored in as that's ageist?

Same can be said for the old!

Here's a good one. How about the reckless and immoral drivers who risk your life when they drive about drunk and get banned? They'll be going to the EU next claiming inequality purely because of alcohol readings.

Right, I'm off to the swimming pool for some training where I shall instead go into the female changing area. When I am challenged I plan to politely inform them that I have every right to be there as banning me would be an act of inequality and if they persist I shall go to the EU court of human rights and claim damages :rotfl:

PricingGuy

I work in insurance doing motor pricing and I want to clear up a lot of misunderstandings. The insurance industry doesn't do a great job of educating people on how and why things are done. This is why there are some misconceptions about what will happen from this ruling.


The price of your motor insurance is based on just one thing - the amount of money we think we will have to pay back to you in the future. If you have a claim then your insurance price increases. This is not to try and claw money back, but because past claims are a good indicator of future claims - statistically speaking. You have to forget about past claims, what's done is done.

The reason for this is due to competition between insurers and profit levels. If I decide I wanted to punish you for your claim and load up your price that would create a gap between the amount I would need to charge to make profit and my price. A competitor recognising this could offer a cheaper price than me, and still make money.

This makes my job an endless search to work out the most accurate price I can for any individual. Too low and I lose the company money. Too high and a competitor wins the business. Now I don't have a crystal ball, so I can only use past behaviour and information as an indicator of future risk by seeing what has happened for other people that 'look' like you.

This is discrimination. I'm judging you based upon all these factors because of what other people have done. For example:


Young males tend to cost us more, but just because you are a young male doesn't mean you will cost us more.

You drive a fast car, that a lot of people have accidents in. But just because they have accidents in it doesn't mean you will.

You live in an area with a high level of crime. But just because 2 of your neighbours had their car nicked and burnt out doesn't mean you will.

You have recently caused an accident, and people who have caused accidents are more likely to cause another one in the next few years than someone who has not had one, but that doesn't mean that you as an individual are more likely to have one.

You are married, and generally people who are married have fewer accidents, but just because you are not married doesn't mean you as an individual are more likely to have an accident than any married person.

Your car is red, and people with red cars tend to be involved in more accidents... actually this one was proven to be not true, but it was looked at!



I hope you understand that everything that is rated on is discrimination. If you say that you are not allowed to rate on gender because you have to rate as an individual rather than on putting them in a group then this same rule can be applied to every other question you are asked. It is impossible to price an individual because you don't know what will happen in the future to them. This ultimately would result in everyone having the same single premium and the low risk subsidising the high risk.

Yes the current system is not perfect.

starrystarry

Percy1983 wrote: »

Strictly speaking if the odds of being hit where 1 in 10 the odds on being hit twice would be 1 in 100, so the person who hasn't been hit is on 1 in 10 odds while somebody who has is now on 1 in 100...

Oh dear. You really don't understand probability do you? Epic fail.

mikey72

I'm sure premiums for both will go up, due to the great losses and poor returns from car insurance that keep being posted. I'd believe it more though if insurers didn't keep putting up figures like these though.

Todays results from Admiral.

"Admiral announces another record profit coupled with continued strong growth. Profit before tax at £266 million was 23% ahead of 2009, whilst turnover rose 47% to £1.58 billion. The Board is proposing a record final dividend for 2010 of 35.5p per share, to be paid on 10 June 2011"

"Record return on capital of 59% (2009: 54%) "

Comment from Henry Engelhardt, Group Chief Executive

"The big success was the UK motor insurance business. It's a snowball going like a freight train. Downhill. Wow! "

http://www.admiralgroup.co.uk/press/pressreleases/02_03_11.php

dunstonh

I'm sure premiums for both will go up, due to the great losses and poor returns from car insurance that keep being posted. I'd believe it more though if insurers didn't keep putting up figures like these though.

You know how Tescos keep reporting big profits but Farmers keep getting squeezed? Think of it like that.

mikey72

dunstonh wrote: »

You know how Tescos keep reporting big profits but Farmers keep getting squeezed? Think of it like that.

Admiral do a good proportion of their own underwriting as well as their other also profitable business

I've been saying it since I started posting.

The insurers are Tesco's, we're the farmers.

Percy1983

starrystarry wrote: »

Oh dear. You really don't understand probability do you? Epic fail.

Not really am epic fail, I am only talking about the odds on getting hit, the odds on causing accidents is quite different, yes I used a very basic example but its true the odds on only getting hit once are less than getting hit twice however you look at it.

Funny how Admiral are mentioned as it looks like they are about to get my business for the 3rd year running, this is based ont he fact they don't seem to see me as much as scum as the other insurance companies so are charging me less and getting to keep the lot as I haven't got to 8 years NCB by accident.

starrystarry

Percy1983 wrote: »

Not really am epic fail, I am only talking about the odds on getting hit, the odds on causing accidents is quite different, yes I used a very basic example but its true the odds on only getting hit once are less than getting hit twice however you look at it.

Funny how Admiral are mentioned as it looks like they are about to get my business for the 3rd year running, this is based ont he fact they don't seem to see me as much as scum as the other insurance companies so are charging me less and getting to keep the lot as I haven't got to 8 years NCB by accident.

It is an epic fail I'm afraid. Lets assume the odds of being in an accident on any given day are 1 in 10. If you are in an accident today and you then go out in your car tomorrow, the odds of you being in an accident tomorrow are still 1 in 10, not 1in 100.

Percy1983

starrystarry wrote: »

It is an epic fail I'm afraid. Lets assume the odds of being in an accident on any given day are 1 in 10. If you are in an accident today and you then go out in your car tomorrow, the odds of you being in an accident tomorrow are still 1 in 10, not 1in 100.

Well yes that does depend on how you are applying the odds, if the odds are daily then yes they would renew daily, but if the odds of getting it in a year a 1 in 10 then the odds on being hit twice would 1 in 100 for the year.

My point is just going with bad luck, if you are hit through no fault of your own the odds are somebody else will get hit next time and not you again (you bas luck is out of the way as such).

Yet again as I said I used a very basic example to which I know its not that basic but moving it on if somebody is more likely to get hit (eg 1 in 5) then thodds of twice is of course 1 in 25, so somebody who is twice as likey to get hit is still less likely to get hit twice.

As I say basic examples.