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Car insurance for women up 15% ahead of new EU gender rules kicking in next week
18:00 GMT, 14 December 2012
Car insurance quotes for women are up 15 per cent, or 114 on average, ahead of new European 'gender neutral' rules which kick in next week.
A car insurance quote for women is now 862 on average – up from 748 six weeks ago, according to price comparison website Gocompare.com.
New rules, which come into force on December 21, mean that insurers will no longer be able to use gender when calculating how much a customer will get in retirement income, or how much they need to pay for their car and life insurance.
New rules: The change will mean that young female drivers could pay 24 per cent more for their car insurance
searches for car insurance quotes made for women of all ages on the
website, including comprehensive cover and third party policies.
The site, which has monitored more than 10 million car insurance quotes since January 2011, said this is the biggest shift it has seen in premiums so far.
It said the typical best price for women aged 17 and 18 has reached 2,191, representing a 281 hike from the start of November.
Women have traditionally benefited from lower car insurance premiums due to their lower accident rates. In other insurance areas, men have tended to receive higher pension income annuity rates due to their lower average life expectancy, while life insurance has been cheaper for women as they live longer and so if payout periods are limited they are more likely to live beyond them.
The full impact of the new rules which come into force next Friday is yet to be seen, although the choice of premiums available to younger drivers is already showing signs of shrinking back.
Gocompare found that 17-year-olds looking for insurance today would get an average of 32 quotes, which is three quotes fewer than they would have typically had at the start of November.
The changes could lead to many younger drivers being forced off the road. Insurer Aviva recently found that a third of parents who help with their children's car insurance believe higher premiums when the new rules come in will force them to give up these payments.
While comparison website Confused.com said it will be younger drivers, aged 17 – 25, who will see the biggest hike. It predicts their premiums will go up by 24 per cent, or 299, on average – from 1,247 to 1,546.
All change: Car insurance price will rise for women after EU gender neutral rules kick-in, according to Confused.com
The choice of policies for younger drivers is likely to contract further as insurers temporarily step out of the market for this sector until prices settle down, Gocompare said.
The website's head of motor insurance, Scott Kelly, said: 'We've tracked male and female premiums for the last 23 months and this is the first real sign of movement as a number of insurers begin implementing rate changes.
'However, with the majority of insurers saying they are leaving full equalisation until the last minute we are not going to see the real impact of the ruling on the best prices available until 21 December.'
Despite the prospect of premiums rising, analysts have advised women not to consider cancelling newer policies now to try to lock themselves into a cheaper deal, as they face having to pay a cancellation fee which would eat into any possible savings they could make.
They could also jeopardise their no claims bonus by cancelling, as successive years need to be built up.
Price change: The five most expensive regional car insurance prices for women aged between 17-25, according to Confused.com
Kevin Pratt, an insurance expert at website MoneySupermarket.com said previously that he expects insurers to ask drivers more searching questions about their records to try to identify how careful they are.
The Association of British Insurers (ABI), which has published guidance about the ruling on its website, suggests that those who want to keep their car insurance premiums lower could consider extra security measures such as having an approved alarm fitted.
Some drivers could potentially benefit from having a telematics 'black box' installed in their car, which monitors driving and helps reward careful drivers with lower premiums.
The ABI has said that customers should not focus on price alone but should shop around and buy the most suitable products.