Equality and insurance

Anyone got any views on the recent case where a lady had a loading imposed on her policy because she was over weight and has been cleared by the high court to take a case to the equality tribunal?

Surely insurance depends on the risk transfer, equitable premiums and the common pool all working together. An underwriter should be able to decide (without reference to equality) as to whether or not to accept a risk and to calculate a suitable premium as this gives everone who are not above average risks an equitable premium.

I know equality works outside of this but if this goes through then why should those of a lesser risk be asked to pay higher premiums to subsidise those of a greater risk?

There are bigger implications than just insurance if the ET effectively classes obesity as a disability, employers for one will be hit very hard.

I don't think it's quite panic stations just yet, after all the ET may rule it isn't a disability and/or that it isn't discrimination. Though I have to be honest, based on other decisions I really don't have much faith in this outcome.

Sumatra said:

Anyone got any views on the recent case where a lady had a loading imposed on her policy because she was over weight and has been cleared by the high court to take a case to the equality tribunal?

Surely insurance depends on the risk transfer, equitable premiums and the common pool all working together. An underwriter should be able to decide (without reference to equality) as to whether or not to accept a risk and to calculate a suitable premium as this gives everone who are not above average risks an equitable premium.

I know equality works outside of this but if this goes through then why should those of a lesser risk be asked to pay higher premiums to subsidise those of a greater risk?

Click to expand...

Found this on the Equality Tribunal website:


The Acts allow people to be treated differently on any of the grounds in relation to:

• Insurance - Covering annuities, pensions, insurance policies and other matters relating to risk assessments but only if the differences are based on actuarial or statistical data or other relevant underwriting or commercial factors and are reasonable having regard to the data or other relevant factors;

I haven't been following the case in detail, so I don't have any comment but the above seems to say that standard insurance practices (varying rates determined by risk, etc) are fine once they can be based on hard cold facts...

Latrade it must be very satisfying for this legal eagle to bring such a test case.

Thanks for the link Novaflare. My reading of that is that if obesity is voluntary and correctable then it can't be discrimination to have obesity discrimination?

We know obese persons do not have equal expectation of claim under a life policy but to have to prove each case so as to avoid an action under disability will be like treading on egg shells.

I wouldn't like to see life assurance adopt a system similar to the present health insurance system of equalization.

I thought that the idea of insurance was about the pooling of risk whereby the losses of the few are covered by the good fortunes of the many who do not have to make a claim.

Surely, if a condition raises the probability of an individual policyholder having a claim that constitutes adverse statistical selection against the policyholders who are "normal" risks.

Indeed, one could argue that if the insurance underwriter fails to load an adverse or inferior risk that would actually constitute a form of adverse discrimination against the normal risks who are being unfairly asked to cross subside the adverse risk.

As far as the case under discussion goes I think that the lost High Court action does not matter. All that did was decide that the Equality people have jurisdiction to deal with the complaint. The complaint now has to be proven on it's merits.

I suspect that this may be one of those cases where the word "discrimination" is being misused in a politically correct fashion as distinct from the mathematical sense of identifying an anomoly in the presented risk.

If the insurance compant lose this one they may just give up underwriting as any decision to load could be argued as constituting discrimination.