The fact the EU gender directive is pushing insurers to sell products to women is causing some debate in the industry.
In April we reported that the cost of women’s life insurance is set to go up. This is due to the European gender directivewhich comes into force in December this year. It means men and women will be treated equally when insurers are underwriting policies. Experts predict a 15% increase in protection for women.
This has led to many insurance brokers promoting health and life insurance to clients, particularly women, in turn triggering a heated debate among insurance companies. In April, Scottish Provident launched a campaign urging advisors to take advantage of the directive and connect with female customers.
Exeter Family Friendly sparked a war of words when it branded other insurers “sad” for encouraging advisers to promote life sales before prices go up later this year. Roger Edwards, propositions director at Scottish Provident, said at the time the EU ruling is a “fantastic opportunity” for advisers to engage with female clients and promote the need for life insurance.
But Nick Jones, brand and marketing manager at Exeter Family Friendly, says this is just the sort of short-term thinking the protection industry could do without. He argues that such messages put monthly sales figures before long-term objectives and could damage the industry’s reputation by losing consumers’ trust.
It seems the new ruling coming into effect has kick started insurers to open communication channels with female customers. Reports show women are severely underinsured when it comes to protection products. It comes as little surprise that brokers are using the ruling and the fact women are not buying insurance to push up their sales.
If the gender directive encourages insurers to talk to customers about buying life insurance then it is a good thing. The problems come when the focus is on price and driving up sales. Phil Brown, protection and underwriting director at Zurich UK Life, said while the change does bring opportunities, price should not be the only factor taken into account on sales.
He added, “We believe it is important that consumers are aware of the impact of the gender directive and its implications for price, but there are additional factors which consumers need to consider when taking out a policy.”