Why Women Pay Less for Car Insurance Than Men

Traditionally, women would automatically receive cheaper quotes for car insurance on account of their gender.

Comparison engines and insurers would query you about your gender when you sought out quotes and return cheaper premiums for female motorists.

The discount reflected the fact that, for all the stereotypes about female drivers, statistically, women are less likely than men to be involved in automotive accidents and make insurance claims.

Men drive more miles than women, speed more frequently, are involved in more traffic accidents, and when they are in collisions, they’re more serious.

According to the road safety charity Brake, men represent 74% of deaths on UK roads, 70% of serious injuries, and 57% of minor injuries.

They’re also more likely to drink-drink-drive and have motoring convictions than women.

All together, women are safer uses of the UK’s roads than men and auto insurers used to reward them with premiums up to 50% cheaper than those paid by their male peers.

Law change

That all changed when the European Court of Justice (ECJ) ruled that car insurers could no longer take into account gender when calculating insurance premiums.

Giving women discounts simply because of their gender was “ incompatible with the principle of unisex pricing included in EU gender equality legislation,” the court found.

The change of law, which came into effect 21 December 2012, saw a sharp increase in the premiums women drivers pay for their car insurance. 

Female drivers are now paying premiums that reflect the risk posed by male drivers. And young female drivers, now lumped in with the most hazardous drivers on the road, young men, have seen the greatest cost increases.

According to data from AA, before the ECJ ruling, female drivers between 17 and 22 used to pay an average of £2,057 in car insurance premiums, compared to the more than £3,000 paid by their male counterparts.

The elimination of the gender discount has tacked an estimated £531 onto the annual premiums for these female drivers since 2012.

The reality

Although women can’t receive discounts simply for being women anymore, they continue to pay less for their car insurance than men.

MoneySuperMarket found that women pay 22% less for their premiums than men. In July 2018, women paid an average of £454 per year for fully comprehensive cover, compared to the £567 paid by men.

Insurers aren’t breaking European law. Women are simply locking in discounts by being safer drivers.

Women remain less likely to be involved in accidents and to make claims, meaning they’re able to rack up years of no claims bonuses that can shave up to two-thirds off the cost of annual premiums.

Women are also less likely to have motoring convictions that can inflate insurance premiums for drivers for years. 

Telematics insurance policies also allow safe drivers to make significant savings by demonstrating their driving prudence and prowess to a black box.

Women, who are more likely to stay within speed limits and drive fewer miles on average than men, are most likely to be rewarded by these black box policies.

And while insurers aren’t allowed to ask your gender, they can still obtain a lot of other information about you, including your occupation, and use that to calculate your premiums.

Many professions remain sex-segregated—women are more likely to be nurses and men more likely to be builders—and insurers have found them to post different driving risks.

Moneysupermarket.com found that the occupation with the worst rates of drink-driving was scaffolders, while midwives were least likely to get behind the wheel after a few drinks.

And it doesn’t seem unreasonable to assume that most scaffolders are men, and most midwives women.

Women are also less likely to drive heavy, high-powered and expensive vehicles in the upper rungs of the car insurance groups. The mini, compact, and economy cars favoured by women will also earn them car insurance savings.

So while young women having seen their premiums rise under the new legislation, overall the gap between the premiums for men and women has actually increased since 2012.

Moneysupermarket.com found that in 2012, men on average paid £27 more for car insurance than women, and as of January 2017, the figure had nearly quadrupled, to £101 more. 

On average, car insurance remains cheaper for women but you won’t automatically earn those savings because of the ‘female’ on your birth certificate and driver’s licence.

But a woman’s occupation, driving history and performance, and vehicle can all contribute to lower insurance costs.