Underwriting annuities on grounds of gender is discriminatory and the UK should accept an EU bid to outlaw it says Adrian Boulding, pension strategy director, Legal & General.
Boulding, who is on the ABI’s pensions committee, points out that ethnic origin is a far more significant factor, yet nobody would dream of underwriting on such a basis.
His comments come as the European Court of Justice is considering an opinion published by EU advocate general Juliane Kokott calling for a ban on underwriting on grounds of sex.
Critics say a ban would leave most consumers worse off and distort the market as providers targeted genders that were better risks – women in the field of motor insurance and men for annuities.
The ABI has been lobbying hard against Kokott’s opinion, and a decision is expected early in 2011.
In a wide-ranging interview to be published in the December issue of Corporate Adviser, Boulding says: “Gender is not the most significant factor in longevity. Ethnic origin is a more significant factor when it comes to life expectancy, but it would be completely unheard of to use ethnic origin as a factor for underwriting insurance products like annuities and car insurance.
We have other data that we can look to for rating factors, such as smoking, postcode and size of pot, where we pay more to people with smaller pots.”
Billy Burrows, director of Burrows & Cummins says: “I fully support equal treatment, but the reality is women live longer than men. Women still get fair value.”