Travel and car insurance customers will, in all likelihood have to endure higher insurance premiums if the Equality Bill affects the way insurers can use age to help them assess insurance risks.
This is the recent warning issued by the Association of British Insurers (ABI).
The bill, introduced in the Queen’s speech last last year is intended to prevent age discrimination but may have a negative impact for some, particularly the elderly.
It is highly possible that by restricting the use of age as an underwriting and risk aid for insurers, could lead to some deciding to pull out of the older customer insurance market, thereby restricting their choice.
Insurers remaining in the market, could well find themselves having no alternative but to increase their premiums accordingly, which completely contradicts that which was intended, namely ensuring that fair prices are available to all, including the elderly.
It is feared that restricting the use of age for underwiriting assessment would result in insurers being unable to take account of differences in risk among older customers.
Given we are an aging nation, insurers may need to change their approach, such as requiring individual medical assessments, the costs of which would ineveitably be passed onto the customer resulting in higher premiums in all probability.
It is possible that the reading of the Equality Bill could start shortly, but any regulations relating to financial services could be delayed for a little while yet.