CAR INSURANCE NEWS ROUNDUP: WEEK ENDED 30 JAN 2013:
While car insurance rates may have dropped overall recently, not all insurance policies are created equal: women have been losing out, one insurer says.
According to the latest price index from AA Insurance, it is true that the price of the average comprehensive motor car insurance policy has dropped by around 2.9 per cent from October 2012 to January of this year, costing typical motorists £789. This represents the lowest average price since October of 2011, remarked the AA; however, these overall prices mask the fact that some drivers – especially young women – saw hefty price increases indeed.
Female drivers between the ages of 17 and 22 years saw a 4.7 per cent rate hike to a new average of £1,464, according to the research findings. Meanwhile, young men of the same age experienced a 1.9 per cent price drop, leading to a new average of £1,858 a year.
These price increases for women come, ironically enough, on the heels of a ‘gender equality’ ruling that went into effect in the UK from 21 December – a ruling that makes it illegal for insurers to take gender differences into account when assessing risk for insurance policies. Of course, this means that the statistical likelihood of young women getting into car accidents – which is much lower than their male counterparts – is no longer valid and cannot be used to provide young women drivers with discount car insurance.
The rate adjustments of the past few months are likely to continue for at least a few more weeks, according to AA Insurance’s director, Simon Douglas, as he believes that insurance companies are still balancing out their businesses in order to comply with the new regulatory changes. The sad part is that changing the law won’t mean that young men are going to get into fewer accidents, Mr Douglas said; with premiums dropping for young men, this could create a situation where too many could flock to a given insurer, resulting in increased costs once the accidents start happening.