Home > Blog > Brexit Lower Phone Insurance Costs Women

Could Brexit mean lower phone insurance costs for women?

Joe Howell's picture

Will Brexit affect mobile phone insurance costs

It’s a well-known fact that men are statistically more likely to claim on their car insurance policy compared to women, and for years insurers adjusted their premiums to take account of this. All other factors being the same, men would pay more to cover the additional risk.

However, since 21 December 2012 the EU has banned insurers from taking customers’ gender into account when deciding how much to charge them. They ruled that the practise discriminated against people based on their sex, and this went against their fundamental principal of equality between men and women. The result was a significant increase in the amount that women paid for cover (often up to 30% more in the case of car insurance) and a modest decrease in the amount men paid (around 10%). Many consumers and insurers saw this ruling as unfair because, in the case of car insurance at least, women were now shouldering an equal share of the claim costs despite being significantly less likely to have an accident.

Now that the UK has voted to leave the EU, there’s much speculation as to whether this directive will be overturned - and several industry advisers have said they are already assessing the chances of reform on gender neutrality. If this happens then Brexit could mean that women once again pay less than men for many insurance products.

 

Why might this affect mobile insurance?

We recently ran some analysis on our claims database and found that men are 71% more likely to claim on their mobile phone insurance policy compared to women.

The risk of loss and theft was largely the same between the sexes, but risk of accidental damage (such as cracked screens and liquid damage) was over twice as high for men.

Mobile insurance claims - men vs women

We haven't yet looked into the specific circumstances that resulted in our male customers claiming so much more frequently, but we aren't hugely surprised by the results. Afterall:

 

So will Brexit bring higher gadget insurance costs for men and lower premiums for women?

It’s certainly possible, but we think it’s quite unlikely - at least for the foreseeable future.

Unlike most other insurance policies, mobile phone and gadget insurance costs aren’t currently affected by the customer’s risk profile. Factors such as address, occupation, age and gender have never been used to calculate premiums and so it seems unlikely that that will change even if the EU directive is overturned.

Insurers in other industries are far more likely to start factoring gender into their pricing if the law does change, but the AA has already suggested that it’s unlikely to happen. They said that they don’t expect the ban to be lifted “given that the industry has now adapted well to the new ruling and there would be a significant cost to insurers to do so”. So even if the ruling on gender neutrality is reversed, it could be sometime after Brexit that we start to see the effect on premiums.