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Unisex Insurance Pricing: Consumers’ Perception and Market Implications

Author

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  • Hato Schmeiser

    (Institute of Insurance Economics, University of St. Gallen, Kirchlistrasse 2, 9010 St. Gallen, Switzerland. E-mails: hato.schmeiser@unisg.ch; tina.stoermer@unisg.ch; joel.wagner@unisg.ch)

  • Tina Störmer

    (Institute of Insurance Economics, University of St. Gallen, Kirchlistrasse 2, 9010 St. Gallen, Switzerland. E-mails: hato.schmeiser@unisg.ch; tina.stoermer@unisg.ch; joel.wagner@unisg.ch)

  • Joël Wagner

    (Institute of Insurance Economics, University of St. Gallen, Kirchlistrasse 2, 9010 St. Gallen, Switzerland. E-mails: hato.schmeiser@unisg.ch; tina.stoermer@unisg.ch; joel.wagner@unisg.ch)

Abstract

The main reason for different insurance premiums and benefits is the use of different statistically proven risk factors in actuarial calculations for individuals. Basing its ruling on European Union Directive 2004/113/EC, the European Court of Justice on 1 March 2011 concluded that any gender-based discrimination is prohibited, so gender equality in the European Union (EU) must be ensured from 21 December 2012. Until then, gender-specific premium differentiation was allowed in most EU Member States for risks that are strongly linked to gender. We discuss the relevance of price differentiation criteria from the point of view of insurers, regulators and ethicists, and reflect on the degree of acceptance of such price differentiation by consumers, which is assessed empirically through an international consumer survey conducted in the United Kingdom, Germany, France, Italy and Switzerland. The perception of risk factors and of effective gender-related price differences is considered with respect to motor, annuity, term life and health insurance. Finally, we discuss possible consequences of the new regulation for the insurance industry.

Suggested Citation

  • Hato Schmeiser & Tina Störmer & Joël Wagner, 2014. "Unisex Insurance Pricing: Consumers’ Perception and Market Implications," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 39(2), pages 322-350, April.
    • Handle: RePEc:pal:gpprii:v:39:y:2014:i:2:p:322-350
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    Citations

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    Cited by:

    1. David A. Cather, 2020. "Reconsidering insurance discrimination and adverse selection in an era of data analytics," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 45(3), pages 426-456, July.
    2. Chen, An & Vigna, Elena, 2017. "A unisex stochastic mortality model to comply with EU Gender Directive," Insurance: Mathematics and Economics, Elsevier, vol. 73(C), pages 124-136.
    3. An Chen & Elena Vigna, 2015. "A unisex stochastic mortality model to comply with EU Gender Directive," Carlo Alberto Notebooks 440, Collegio Carlo Alberto.
    4. Frederick Kwesi Blay & Livingstone Divine Caesar, 2022. "The adoption of mobile money technology in emerging markets: a contingency analysis from Ghana," SN Business & Economics, Springer, vol. 2(9), pages 1-26, September.
    5. O. C. Ferrell & Dimitri Kapelianis & Linda Ferrell & Lynzie Rowland, 2018. "Expectations and Attitudes Toward Gender-Based Price Discrimination," Journal of Business Ethics, Springer, vol. 152(4), pages 1015-1032, November.

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