The subject of gender pricing across the insurance world has been concerning actuaries and underwriters in recent years and a forthcoming decision by the European Court of Justice is likely to bring this into focus again.
The use of a person’s gender to underwrite risk is likely to be outlawed. This will have ramifications across all sorts of financial products as diverse as annuities and motor insurance.
The effect on life assurance premiums is also likely to be significant.
Interestingly, this legal intervention moves underwriting in the opposite direction from the trends in the marketplace, where underwriting risk factors are an increasingly important part of providers’ profitability factors and, of course, an adviser’s process of securing the best deal for borrowers.
Substantially improved benefits can be obtained for clients who have lifestyle influences such as smoking on products like annuities and equity release. A fact-find should, as a minimum, look to draw out these responses.
Accuracy is vital as the checks available to insurers are becoming far more wide-ranging and accurate.
Product providers will continue to investigate ways of sharpening their information when underwriting risk.
The key aspect from a client’s perspective is to choose a provider where this maximises their benefits.