Read the story here: EU Court Bans Insurance Sex Discrimination
In summary, the highest court in the EU recently ruled that Insurance companies including medical, car, life, and other policies, cannot charge men and women differently for insurance. Historically, both in the US and the EU, women have paid more for insurance with these companies citing that their female customers indeed do cost them more money and therefore, it is only fair that their premiums reflect their higher costs. However, the court ruling lays down that charging different rates on the basis of sex is blatent discrimination and has now made the practice illegal. Insurance companies have responded threatening higher premiums for everyone now to cover the higher costs of female customers.
My Take
So why hasn't the US done the same? Insurance companies insist that it is statistically possible, and easy, to prove that women cost them more when utilizing insurance. On the surface, this seems easy enough to believe. Our medical costs are generally higher due to the ability to birth a child, life insurance would pay out at a higher rate due to a higher life expectancy than men, and when a woman carries homeowners insurance in her name only the assumption that she is single and therefore less apt to fix or repair a house problem so she lets the insurance take care of it instead. Albeit sexist in nature, these things are statistically true.
The problem with statistics is that they are a one sided view of a large population and can be easily manipulated to reflect a desired outcome of information. I could go on all day about wrongful statistical implications so let's take a different approach with an example of medical insurance and spare some wind.
Meet Jane Doe and John Everyman. Jane, being a woman, pays significantly higher premiums for her medical insurance. Jane is an empowered single woman who is the picture of health - she exercises daily, eats well-balanced meals, and takes excellent care of herself. She does not plan on having children. John Everyman however, sits on the couch drinking beer and eating potato chips in front of the TV all day. He is quite sedentary and quite often ill. John, being a man, pays lower insurance premiums than Jane. The point is this: while is is possible to prove statistically that women (plural) cost more in medical insurance, Jane Doe will not cost her insurance company more than chronically ill John Everyman and yet, still pays more for coverage. It is discrimination on the basis that being a woman does not make her "everywoman" and ignores Jane's individual case scenario and lifestyle which are HUGE factors in long-term costs to insurance companies. In short, its a cop-out excuse.
The Solution
Instead of simply generalizing on a statistical basis, why can companies not do a comprehensive interview of the individual and adjust their policy accordingly? It is not being a woman that makes medical insurance high for women, its the ability to birth children. If a female client does not plan to or better yet, medically cannot have children, why should she pay more? Same goes for homeowners insurance. What if a woman is currently paying a higher rate on her homeowners insurance but does construction for a living? Basically, I'm simply suggesting that if insurance companies really want to use the excue of charging people fairly for policies they need to get to know their clients as individuals and be able to take into account certain factors within their lifestyle that could substantially influence the probability of a high cost customer. If they're willing to collect the infomation, a small investment into a database could give them more accurate and less discriminatory information that could even save them money in the long run. No more excuses.
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