The Test-Achats case—the pension implications
Produced in partnership with Elizabeth Ovey of Radcliffe Chambers

The following Pensions practice note produced in partnership with Elizabeth Ovey of Radcliffe Chambers provides comprehensive and up to date legal information covering:

  • The Test-Achats case—the pension implications
  • Common insurance practices before the Test-Achats case
  • The application of EU equality principles
  • The reasoning in Test-Achats
  • The Charter of Fundamental Rights of the European Union
  • The Gender Directive
  • The ECJ’s judgment
  • Implications of Test-Achats for insurers
  • Steps taken by the government
  • Definition of ‘new contract’
  • More...

The Test-Achats case—the pension implications

This Practice Note considers the implications of the case Association belge des Consommateurs Test-Achats v Conseil des Ministres (the Test-Achats case) and other relevant law on the use of sex-based actuarial factors in insurance products and occupational pension schemes.

Despite Brexit, the European Test-Achats case and other EU case law pre-dating IP completion day (11pm on 31 December 2020) referred to in this Practice Note continue to be binding on UK courts and tribunals post-IP completion day, until the UK courts exercise their powers to diverge. For more information, see Practice Note: Introduction to retained EU law.

Common insurance practices before the Test-Achats case

Insurance companies used to apply certain common practices before the Test-Achats case:

  1. statistically, women are likely to live longer than men, so insurance companies commonly offered women a lower annuity for the same capital sum because it has to be paid for longer

  2. statistically, men have more car accidents than women, so insurance companies commonly charged men (and, in particular, young men) higher premiums for motor insurance

  3. statistically, women are more likely to claim under health-related insurance policies than men, so insurance companies commonly charged women higher premiums for such policies

These results followed from putting men and women in different classes for the purpose of risk assessment. It is obviously possible for insurers to calculate the cost of annuities

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