02 March, 2011


When Sheila's wheels came off

I can't get unduly worked up either way about the EU decision to ban gender-based car insurance. Insurance is a method of sharing risk. There is no fixed answer to the question of who should be allowed to share that risk with you and thus potentially benefit from the pool. We are pulled in one direction by the desire to minimize cost; we are pulled in the other direction by notions of equity and fairness. If we allow women to benefit from their collectively smaller claims records, what happens if the stats reveal that Black men are significantly more expensive to insure than White men; do we allow policies available to White males only?

Where do you stop? The (il)logical conclusion is a pool of one: insure yourself. Which is what, incidentally, I have chosen to do in regard to household contents insurance. (Not household structure, i.e. "buildings" insurance, which is an entirely different kettle of bananas.) I am lucky enough to have the savings to cover replacement of the contents should the worst happen, so I have chosen to carry that risk myself rather than argue the toss with an insurance company motivated by an intense desire not to pay out.

On balance, I think I'd take the position that since both women and wimmin have campaigned long and hard for equality of opportunity and equality of treatment with men, then they have to accept the package as a whole, including the disadvantageous bits.

I'd say Ed West summarizes it well ...

But that’s the point – it may be an utterly absurd decision that will needlessly punish women drivers, but the ruling is certainly not discriminatory. On the contrary, it bans companies from discriminating between a group of people less likely to crash, and a group more likely to, using short-term stereotyping until they have a better measurement of an individual’s behaviour (after all, if a man drives well, then his premiums will come down). It is completely consistent with the goals and aims of the entire egalitarian movement – that of taking decisions away from individuals and independent groups and having the state regulate them. If Arlene McCarthy believes it’s unfair not to discriminate, what’s she doing in the Labour Party?

I don't agree that the ruling is absurd; it's just logical. And it might be that the egalitarian approach arguably has the edge here: start everybody off on the same, relatively high tariff, and reward good behaviour in individuals.

Sorry, girls, you want to "have your cake and eat it". It looks like "you've made your bed, so you will have to lie in it".

It's not the motor insurance aspect that's the real issue; it's the annuity purchase issue which'll make sure that male purchasers will get less of a pension, and women will get slightly more. I know the obligation to buy an annuity has just disappeared, but even that has its problems; if you take an income by drawdown from your pension fund instead, you cannot now take 120% of GAD (the Government Actuaries Dept limits) and must limit your drawings to 100% of GAD, unless you have a (comparatively) very large pension fund indeed. Ergo, many drawdown pensioners just got their pensions cut by 20%.

Stuffed one way, and buggered the other.

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