Age discrimination Bill makes insurers wary

01/05/2009

Insurers should be allowed to charge retirees more for cover, an industry group claimed today.

The Association of British Insurers (ABI) said that old age was a "relevant" factor in how much premiums should be.

This week, the government has published its new Equality Bill, which is aimed at stamping out age discrimination.

It has been suggested that, if passed, the new laws would force insurers to stop charging more for old people - particularly for travel insurance.

However, the cover providers say that they must be allowed to vary the premiums in order to reflect the true risk level for each customer.
Older people, for example, pay more for travel cover because they are more likely to fall sick or get injured on holiday according to insurers.

Malcolm Tarling, spokesperson for the ABI, said: "Insurers want to be able to continue to use age as one of the ways in which they assess risk, simply because age in many parts of insurance, is very relevant ... You take away a particular rating factor such as the use of age, then it is going to be forcing insurers to almost operate with one hand tied behind their back.

"They [providers] will have insufficient information to assess the risk."

Research from Moneysupermarket.com suggested recently that 66-year-olds pay on average 106 per cent more for travel cover than 65-year-olds.

Tags; Advice on Travel Costs, Retirement Money Problems,

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