4 Mortgage PPI Costs Increase due to New EU Regulations.

Thousands of women in the UK will see a sharp rise in the cost of insurance later this year once new rules outlaw the use of gender in calculating insurance premiums. Currently, some forms of insurance are cheaper for women and others for men. From 21^st December 2012, insurers will no longer be permitted to charge rates separately for men and women.

The European Court of Justice’s ban on gender discrimination when setting prices for financial services will come into effect on the 21^st of December 2012. This will also affect men as the ruling means that pension income paid by annuities is likely to fall post 21^st of December. For men, income protection cover costs are likely to increase too.

What’s the impact?

Currently, women typically pay lower for their life insurance costs but according to the new European rules and estimates by the HM Treasury, women’s premiums could go up by as much as 15%.

The ruling will not affect existing insurance policies but they certainly will impact on the pricing of those taken out after the 20^th of December 2012. Women will be hit the most in the form of a hefty increase in the cost of car and life insurance.

Pensions

It’s not just women that the new ruling affects, the pension income paid by annuities is likely to fall by more than 10% for men after the legislation is introduced. Men currently get more income from pensions than women of the same age because of their lower life expectancy (as the pension fund doesn’t typically have to pay an income for as long as they would for females). Lower annuity rates for men will lead to a cut in their pension. The new rules come at a bad time especially for men retiring in the months following the new legislation as there is little time to increase the value of the pension fund.

What can you do?

For females, the best way to ensure that your price doesn’t rise is to take out life cover before the ruling comes into effect. As life cover gets more expensive the older you get, acting now you could save money either way. You can make savings by acting before the new rules come into force. For others, it will be a case of finding other ways to reduce their insurance costs.

For men, it’s more important than ever to shop around for the best deal to boost your retirement income. In addition, men should consider putting income protection arrangements in place before December as costs are likely to increase.

Survival rates for many life threatening illnesses, including cancer, heart attack and strokes are improving thanks to advances in medical research - so consider including critical illness cover to the life or income protection policy to provide important additional benefits.

Life insurance

As women have longer life expectancy than men, they currently pay lower premiums for life insurance. This factor in determining the cost of insurance is to be taken out of the equation under the introduction of the new rules regarding gender discrimination. So by applying for life insurance before the deadline (21^st December 2012), women can save themselves money.

Six in ten women do not currently have life insurance (according to Bright Grey research). If you currently do not have life insurance in place, it would be in your best interests to act before December. In addition, the longer you leave it the more expensive it gets.

Benefits of protection

Protection products ensure peace of mind. This safeguards your family financially and allows them to continue their lifestyle without your income for instance.

About Ascot Mortgages

At Ascot Mortgages, we are committed to sourcing the best deal so that you (and your family) are protected. It’s a win/win situation of both protecting your family and saving money. Our advisers can explain everything you need to know about income protection, annuities, life insurance and critical illness cover. We can discuss the suitability of each type of product based on your situation. Not only that, we can gather quotations from leading insurers so that you get the right cover at a competitive price. Whether it’s a new policy or a review of an existing one, we’re more than happy to help.

Website: http://www.ascotmortgages.co.uk