The Equality Bill could mean higher premiums and lower choice for consumers, warns the ABI

The Association of British Insurers (ABI) has released a report examining the implications of the soon-to-be-introduced Equality Bill. They have underlined their belief that the Bill, designed to ensure that age discrimination does not take place in the supply of goods and services, could result in a sharp rise in insurance premiums for millions of consumers.

If the insurance industry is included in the Bill, it could prevent companies from factoring in age when calculating their customers’ policies. Speaking to the Independent, Malcolm Tarling, spokesman for the ABI, stated his belief that age remains a reasonable part of risk calculation: 

"The simple truth is that age is an important factor. Take travel insurance for instance - the cost of a claim made by someone over 65 is three and half times more than one made by a younger person. As for motor insurance, claims made by 80-year-olds are nearly 50 per cent more expensive than those made by someone aged 60. It is only fair that premiums reflect this extra risk.”

Tarling has also explained the possible consequences of the Government placing such a restriction on the insurance industry. “The danger is if we can't use age as a rating factor, insurers will have to raise premiums across the board for all age ranges,” he said. "We are not against equality legislation, but the Government has to think carefully about how it plays this. This is well intentioned legislation which could have unintentional consequences."