Gender Directive rewards ‘boy racers’ as female motor premiums may rise by up to 40%

The FINANCIAL — The EU Gender Directive will remove price differences between men and women on insurance products from 21st December 2012.

The FINANCIAL — The EU Gender Directive will remove price differences between men and women on insurance products from 21st December 2012. PwC predicts younger women could see their motor insurance premiums rise by up to 40% as a result.

"The EU Gender Directive will have a significant effect on the premiums charged to young drivers from December 21 onwards”, Mohammad Khan, insurance partner, PwC said.

“For young female drivers aged under 25 this will probably result in motor premium increases of between 10% and 40%. For young male drivers conversely, the Directive could result in premium decreases of up to 10% depending on their claims experience.

“Statistics show young male driver are more likely to have more severe accidents and make larger and more frequent claims on their car insurance than young female drivers. Insurers will have to ignore this fact to ensure they comply with the Directive.

“For young female drivers who face steep increases in premiums, it may be worth considering new technologies such as telematics or pay as you drive insurance as this may be cheaper."