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Car insurance battle of the sexes

Close-up of male and female hands playing tug of warWomen's car insurance costs rose in the first three months of 2013 but men saw prices fall, according to the latest Confused.com car insurance price index.

When it comes to car insurance costs, it seems that men are winning the battle of the sexes.

In the first three months of 2013, the average cost of a comprehensive car insurance policy for women rose by 2.3 per cent.

However, for men, the price of a policy fell by 1.8 per cent.

This is according to the latest quarterly Confused.com/Towers Watson car insurance price index.

The index looks at more than 4 million quotes to see what prices drivers have been getting when shopping around for car insurance.

Impact of EU ruling on car insurance prices

It seems that female drivers have paid the price of a decision made more than two years ago by the European Court of Justice (ECJ).

Traditionally, because women have fewer road accidents than male drivers, car insurance for women was cheaper as they were less likely to make a claim.

So if an insurer was presented with a male and female driver with the same car, location, mileage and so on, the female would typically have received a cheaper insurance quote than the male.

But the ECJ ruled that taking gender into account when calculating insurance prices was illegal discrimination.

The European Union, which is bound by the court, said that insurers had to stop this practice by 21 December 2012.

As a result, insurance firms were recalculating prices to level out the difference between men and women ahead of the ruling coming into force on 21 December 2012.

Car insurance costs for men & women 'leveling out'

However, there is some good news.

Despite being subject to hikes in car insurance premiums at the start of this year, it seems the leveling out of car insurance prices between men and women is still a work in progress.

As a result, currently women still enjoy lower prices overall than men.

The cost of annual comprehensive car insurance for men currently stands at £748 on average, compared to £721 for women – a £27 difference.

This price difference is a huge contrast to this time last year when men were paying £117 more on average for annual car cover than women - £868 compared to £751.

Industry reacting to law change

Gemma Stanbury, head of car insurance at Confused.com, said the EU ruling had affected car insurance prices for both men and women.

"With the EU Gender Directive coming into effect late last year, it's clear to see that the insurance industry has reacted to the change in legislation over the last quarter.

"The most recent results from the Confused.com car insurance price index reveal, as expected, that women have experienced the greatest increases to their car insurance premiums.

"Our advice to drivers is simple.

How to cut car insurance costs

"With gender-neutral pricing having come into effect, the need for men and women to shop around for the cheapest car insurance deal has never been greater.

"For the many female motorists facing sharp price hikes now is the time to compare prices to ensure they’re getting the cheapest deal possible.

"Similarly, for those men who now find themselves eligible for hugely discounted premiums, it may be worth shopping around for a new policy which could save them a considerable amount of money."

What do you think?

Have you renewed your car insurance since the start of the year? Has your premium gone up or down?

We want to hear from you! You can share your views on the message board below.

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Naphtalia Loderick

Naphtalia Loderick

Naphtalia Loderick reports on all things personal finance at Confused.com. She started out on a weekly newspaper, via a national news agency and a stint in the fun but ‘not as glamorous as it appears on screen’ world of TV at the BBC researching consumer films for The One Show.

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