The prospect of gender-based insurance rating decisions being outlawed has moved a step closer this week.

The European Comm-ission has advanced a proposal to the Council of Ministers to enforce gender neutrality in the calculation of insurance premiums.

The proposals, sponsored by Commissioner for Social Affairs Anna Diamantopou-
lou, are widely opposed by UK insurers.

British insurers said that ending the use of gender as a factor when calculating premiums would lead to higher rates.

ABI director-general Mary Francis said: "At present we can set prices fairly on the basis of genuine risk, which benefits all our customers.

"Commissioner Diamantopoulou started out with the best of intentions, but this piece of EU legislation will do no-one any good."

A spokeswoman for the ABI said it would lobby the European Parliament to amend the proposals.

Allianz Cornhill general manager Chris Hanks said the proposals would contradict insurers' efforts to provide the correct premiums for customers. "An underwriter will look at all the factors, not just gender. But women drivers have a lower rate of claims
than men of the same age.

However, a spokeswoman for Norwich Union said it did not expect to be unduly affected by the proposals. "The way we assess people for insurance is changing anyway. We don't rely on gender as a factor alone."