Equalities Bill 'could push up insurance premiums'
Consumers are likely to face higher insurance premiums if the Equalities Bill prevents insurers from using age to help assess risk, according to a trade group.
The Association of British Insurers (ABI) has warned the cost of insurance could soar if the government's bill, which is intended to help stop discrimination, makes age-based pricing illegal.
According to the ABI's report, 'Age and Insurance: Helping older customers find the cover they need', the cost of travel insurance alone could double if age could not be used as a risk factor.
Nick Starling, the ABI's director of general insurance and health, said: "Insurers only use age where it is relevant, and restricting their ability to do so would rebound on all customers, through higher premiums and less choice.
"Any legislation should tackle genuine discrimination, not insurance where the use of age helps to ensure a wide range of products at competitive prices."
In motor insurance, the average cost of a claim made by someone aged over 80 is nearly 50 per cent higher than one made by someone aged 60, the ABI claims.
In travel insurance, the average cost of a claim made by someone aged over 65 is nearly three and a half times more than one made by someone under age 50.
Insurers would have to use a more "intrusive and costly approach", such as individual medical assessments, if they could not make an assessment based on age, the group added.
These additional costs would lead to higher premiums, the ABI claimed.
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