With less than a year before the ECJ ruling on gender discrimination comes into effect, there is still confusion as to how insurers should respond, according to specialists.
Insurance industry dispute resolution law practice Clyde & Co believes there is a risk insurance contracts could unravel if insurance companies interpret the ruling in the wrong way.
Gerry Quirk, a partner at Clyde & Co, explained: "The uncertainty lies in what should be considered a ‘new' contract.
"The European Commission and HM Treasury are currently providing conflicting guidance around this."
The EC has issued guidelines stating that a new contract includes any amendment to the terms or conditions of an existing contract as well as a renewal of a contract; but that a tacit renewal is not a new contract.
However, issues of contract law are determined on a national, not Europe-wide, basis. In the UK, HM Treasury has clearly stated in its consultation on the UK response to the ruling that the question will be a matter of UK law - which will not necessarily accord with the Commission's view.
"To a certain extent companies are stuck between a rock and a hard place," said Quirk. "A conservative approach reduces the risk of challenge but will have an impact on pricing and, potentially, competitiveness."
The Commission has provided some guidance on when it considers gender may still be taken into account. However Clyde & Co noted that there is no court ruling on the issues and the position is still not free from doubt.
