17 May 2012
Pension providers are considering reducing the length of time
for which an annuity quotation is guaranteed. This is because
of the implementation of European rules that will ban gender
pricing in insurance contracts.
In March last year, the European Court of Justice ruled gender
pricing for insurance products will be banned from December 21,
2012 following advocate general Juliane Kokott's view that using
gender as a risk factor when pricing insurance is
discriminatory.
The decision will affect the way insurers price annuities, life
insurance, income protection and critical-illness cover.
Pension providers offer customers varying lengths of time for which
an annuity quotation is guaranteed. Guarantee periods of 14 -
30 days would be typical. As gender-specific guarantee
periods cannot go beyond December 21, providers might either
introduce gender-neutral prices early or reduce the guaranteed
quotation periods.
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