EU “unisex” laws take their tolls on the finances of both men and women

UK InsuranceThe latest rule changes in the European Union involving unisex pricing have meant that at the end of this year, when the regulations go into effect, men and women will both be facing expenses that they have never seen before.

A primary example of this change is the ruling that prevents gender discrimination while establishing auto insurance premiums – regardless of the fact that it is less likely that a woman driver will be involved in a car accident than a man driver, and that crashes involving female drivers are usually far less serious.

As this has meant that women drivers typically pay far less in annual insurance premiums, it has meant that as the rates are “equalized”, women are also likely to see significant increases in the amount that they have to pay to insure their vehicles. This is because they will need to pay for their half of the “boy racers”, that is, the aggressive young male drivers who have a significantly higher risk of bad accidents.

According to a treasury analysis, men will see a 9 percent reduction in their rates premiums, while women will be paying 24 percent more.

Similarly, though, these same “unisex” insurance rules in the EU will mean that men will receive notably smaller private pension incomes. The reason is that men and women will be paying the same premiums, and the annuities that are used for the conversion of the total amount into the pension income for the rest of a person’s life are considered to be insurance products.

The majority of people use their pension funds at retirement in order to purchase an annuity that will provide them with a fixed income payment for the rest of their lives. Until now, women were paying lower annuity rates as they have a statistical likelihood of a longer life and will therefore need to draw on this income for a larger number of years.

Now that the rates are “equalized”, women will be gaining, but not as much as men will be losing. While men will receive approximately £200 less per year, women will be receiving about £100 more.

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