Implementing the European Court of Justice judgement views on how insurers can use gender as a risk factor

In March 2011 the European Court of Justice ruled that the use of gender as a risk factor by insurers should not result in individual differences in premiums and benefits for men and women, with effect from 21 December 2012. In June 2011 the Financial Secretary to the Treasury issued a statement setting out the Government’s initial response to the Court’s decision. In this the Government expressed its disappointment with the ruling, stressing that it believes it will have a negative impact on consumers. Despite this there remains an obligation to implement the judement into UK law.

In the June statement the Government clarified its view that the ruling applies only to new contracts entered into after 21 December 2012, meaning existing contracts are not affected. The statement also highlighted the Government’s intention to implement the ruling by amending the Equality Act 2010 and committed to publishing a consultation on the details of this approach along with an impact assessment before the end of the year.

The Government today publishes a consultation document on its proposed approach to implementing the judgement into law and its views on how insurers can use gender as a risk factor in the light of the judgment.

The Consultation document seeks views on the Government’s legal interpretation of the judgment and the accompanying draft regulations that amend the Equality Act. It also seeks comments on the Government’s impact assessment and requests additional data that would contribute to a better understanding of the impact on consumers and insurers. Finally, it asks for views on some of the key issues arising from the judgment, such as the scope of indirect discrimination.

• Press notice: Government consults on the use of gender as a risk factor for insurance

The Treasury received 38 responses to the consultation, the majority of which were from the insurance sector. A list of respondents can be found in Annex C to the response document. The response document summarises the main issues raised by respondents under the six consultation questions and outlines the Government’s response to these. The Government position set out in this document is not intended to represent legal advice as only the courts have the authority to interpret the ECJ judgment.  We are very grateful to those who took the time to respond to this consultation.