UK - EU moves to give women a better deal on annuities will leave everyone worse off, the Association of British Insurers has warned.
The EU’s gender discrimination directive passed its first stage in the EU parliament by 313 votes to 141 with 54 cross-party UK MEPs voting against it.
The directive will now go to the European Council in June and is scheduled to become law in EU states by 2012.
An ABI spokeswoman said: “We wholeheartedly support any discrimination legislation; but if gender were excluded, annuity rates would fall towards the lower female level and because most annuitants are men, they would be deterred from saving for their pensions, with a negative effect on the savings gap affecting both parties.”
Mortality statistics show women have longer life expectancy than men and, as a result, women currently pay less than men for life assurance, but more for annuities. But the directive would enforce a unisex annuity rate in all member countries.
Annuity Bureau managing director Peter Quinton commented: “Imposing a political unisex rate across the board won’t actually help because there is too much else to take into account.”
But Friends Provident manager of pensions research and development Chris Bellers said that there were strong arguments for the directive.
He said: “If you boiled it down, the difference in life expectancy between men and women is between zero and two years, which isn’t that much, so why not have the unisex rate?”
Life expectancy in the UK saw no improvement between 2015 and 2017 as the number of people aged over 90 hit a record high, latest Office for National Statistics (ONS) data reveals.
Self-administered pension funds spent £14bn on payments to pensioners in Q2 2018, but only received £11.4bn of contributions (net of refunds), latest Office for National Statistics (ONS) data reveals.
The Pensions and Lifetime Savings Association (PLSA) has named the 17 members of its inaugural policy board after a competitive application process with 60 candidates.