Equal Status Acts 2000 to 2011
DECISION NO: DEC-S2016-25
Krzysztof Gortych
(Represented by Rostra Solicitors)
V
FBD Insurance PLC
(Represented by Ms Claire Bruton B.L.
Instructed by Matheson Solicitors.)
File Nos. et 155005-es-15
Date of Issue: 22nd April 2016
Keywords
Equal Status Acts 2000 to 2011 – Indirect Discrimination, ground of race ,
1 Delegation under the Equal Status Acts 2000 to 2004
1.1 Mr Krzysztof Gortych (the complainant) referred his claim to the Director of the Equality Tribunal under the Equal Status Acts (hereinafter referred to as “the Acts”) on the 31st March 2015. On the 9th February 2016, in accordance with his powers under section 75 of the Employment Equality Acts, the Director General of the Workplace Relations Commission referred the case to me, Peter Healy, an Adjudication Officer/Equality Officer, for investigation, hearing and decision and for the exercise of other relevant functions of the Director under Part VII of the Acts. A hearing took place on the 22 March 2016 at the WRC, Davitt House, Dublin 2.
1.2 This decision is issued by me following the establishment of the Workplace Relations Commission on 1 October 2015, as an Adjudication Officer who was an Equality Officer prior to 1 October 2015, in accordance with section 83.3 of the Workplace Relations Act 2015.
2 Dispute
2.1 The dispute concerns claims by the complainant that he was discriminated against by the respondent on ground of race in terms of Sections 3(2) (h), contrary to Section 5 of the Equal Status Act, 2000-2012 relating to a quote for car insurance. The respondent was notified on the 23rd March 2015 in accordance with the provisions of the Acts.
3. Complainant’s submission.
3.1 The complainant submits that he is a Polish national residing in Ireland since 2005, who holds a full Polish driving licence since 2000 valid for category B vehicles and a no claim discount of 10 years earned solely in Ireland.
3.2 The complainant submits that on the 18th February 2015 the respondent provided him through their website with a quote of just over €674 for car insurance, taking into account a full EU driving licence. Using the same method the complainant submits he obtained a quote for €502 if he had a full Irish driving licence. The complainant submits that the difference in quotes seems to be caused solely by the fact that the issuing authority of the driving licence was outside Ireland and/or the United Kingdom.
3.3 The complainant submits that the actions by the respondent are an act of at least indirect discrimination. The complainant submits that this Tribunal is required to decide if Section 5(2) of the Acts applies to his complaint in light of various EU Directives and the Test-Achats case (C-236/09) of the Court of Justice of the European Union.
3.4 The complaint submits that he wishes to retain his Polish licence as it allows him to deal with authorities in other EU countries more efficiently.
4 SUMMARY OF RESPONDENTS WRITTEN SUBMISSION
4.1 The respondent does not contest that the complainant used their website to obtain a quick quote for car insurance. The respondent submits that as part of their online quick quote process for car insurance, the Complainant was required to answer a series of questions in relation to his age, sex, license type, address, engine size and estimated car value and the respondent does not contest that the complainant received two different quotes.
4.2 The Respondent submits that it did not discriminate against the Complainant on the grounds of race, contrary to the Acts, or at all. The purpose of the questions which the Complainant was required to answer was for the Respondent to assess the Complainant’s individual risk characteristics as part of the underwriting process and ascertain if verifiable relevant data is available. Relevant data includes driving experience, claims experience, driving record and penalty points. Individual risk characteristics have been identified from regular and comprehensive statistical and actuarial reviews and analyses and are similar to other risk characteristics identified by other insurers in the industry.
4.3 The Respondent submits that the race of the Complainant is not a risk characteristic that is taken into account by the Respondent when assessing risk and it denies that it has discriminated
against the Respondent on the grounds of race, as alleged or at all. The Respondent submits that it was not aware of the Complainant’s race during the quick quote for insurance process application and the race of the applicant is not sought by the Respondent at any stage.
Overview of the Respondent’s Quotation Process
4.4. In order to obtain a policy of insurance with the Respondent, a customer must first seek a
quotation. As set out above, quotations are available via a number of channels, namely online,
by way of telephone and from one of the Respondent’s local sales offices. The Respondent has developed a series of rules for accepting customers for car insurance. These rules relate to, inter alia, vehicle details, driver’s age, driving experience / no claims discount, previous claims and licence type. In addition, the amount of underwriting validation that the Respondent can carry out (both at the point of sale and following sale) is an important factor.
4.5 The quotation process can be broken down into 5 key stages. The respondent submits that each stage requires certain criteria to be met by the customer. If the customer cannot meet the criteria the quotation will not proceed and a declinature letter will be issued.
4.7 Stage 1 of the online quotation process is the Quick Quote facility. This process provides the customer with an indication of whether or not the Respondent can quote for the risk proposed
and an indicative price. This indicative price is based upon seven pieces of information - age,
gender, licence type, no claims discount level, the county the customer lives in, engine size
and the value of the car. The respondent submits that they seek this information in order to quantify and assess the risk that it is being asked to underwrite. With regard to licence type, the customer has to confirm whether the licence they hold is Full Irish, Full UK, Provisional Irish, Provisional UK, Full Other, Provisional Other. Where Full Other or Provisional Other is selected, the customer is asked to confirm the country of issue of the driving license. The type and issuer of the driving licence, together with the responses to each of the other questions, are rating factors which are used by underwriters to determine the price of the insurance premium
Quotation assumptions are outlined as part of this Quick Quote facility and in order for a
customer to obtain a quick quote, he / she is prompted to tick a box to confirm agreement with
the quote assumptions, Terms of Business and Data Protection Notice. Once the customer
obtains a quick quote, he or she is informed by the Respondent that:
‘This is an indicative price based on the information you have provided. This may change at
the next stage of the application process depending on the additional information you provide.’
4.8 The Quick Quote facility does not contain all of the Respondent’s subjectivities and has
particular limits. It is important to note that the Quick Quote facility provides an indicative quote only. It is not a formal quote or offer nor can it constitute a declinature. The receipt of a quick quote via the Quick Quote facility is Stage 2.
4.9 Once the customer has received an indicative price via the Quick Quote facility, he or she
moves into Stage 3 of the process, which is the option to proceed to seek a formal quotation.
The process moves to Stage 4 when a customer confirms that they wish to purchase. Following the issuance of the proposal form by the respondent, the process enters Stage 5. An automatic workflow is triggered in the respondent’s systems to follow up with customers in relation to the documentation the respondent requires in respect of the formal quotation issued.
4.10 The respondent submits that it is notable that in this case, the Complainant engaged in Stage 1 and 2 only and as such obtained an indicative quote. No attempt was made by him to seek a formal quotation. As such, the statement in the Complainant’s submissions that there were no other parameters in the proposal is incorrect, as this information is sought in Stage 3.
4.11 The respondent submits that one of the most significant challenges facing insurers in current years is application fraud and the respondent has provided this Tribunal with examples to back up this assertion.
4.12 It is the respondent’s position that the only way they (and other insurers) can validate or verify the information provided by a customer is through physical screening of quotation documentation or by using technology or other databases to verify the information given. This is in order to deal with thewidespread issue of non-disclosure which is prevalent in motor insurance as outlined above. Many insurers, like the Respondent, use vehicle databases to verify vehicle information. For example, the Respondent uses the Integrated Information Data Services (the “IIDS”) for verification. IIDS is a shared members' database that allows its users to confirm the accuracy of penalty point and no-claims discount information provided by customers when they are seeking to renew existing or taking out new car insurance policies. These are two crucial and
necessary factors in the underwriting process. The IIDS only contains information in relation to
Irish driving licences.
4.13 The Respondent does not have access to a corresponding facility for non-Irish licence types
nor does it believe that such a facility exists. As such, the Respondent is not in a position to
undertake the same validation process in the case of non-Irish driving licences as is applicable
for holders of Irish driving licences. Therefore, the ability of the Respondent to independently
verify and authenticate crucial factors such as penalty points and no claims discount is
impeded in the case of non-Irish driving licences.
4.14 As set out above, the respondent submits that the issue of driving licences is not in any way connected with the nationality or race of the driver. All EU citizens resident in Ireland may exchange their original driving licence for an equivalent Irish driving licence through a relatively straightforward process. Where an applicant does exchange his / her original driving licence for an Irish driving licence, the Respondent submits that it underwrites and assesses the request for a quotation using the same underwriting criteria as it would any other holder of a driving licence issued in Ireland. This is due to the fact that it is possible to validate the information. The Respondent does not make an assumption as to the proposer’s country of origin or nationality.
4.15 At present, penalty points issued in Ireland in respect of traffic offences committed in Ireland are only capable of being applied to Irish driving licences and details of the applicable penalty points are maintained by the Department of Transport on a database.
Legal submissions
4.16 The respondent submits that the complaint arises for consideration as a matter of Irish law only and the provisions of the Race Directive (Council Directive 2000/43/EC) are, therefore not applicable and that the reliance by the Complainant on the Recast Gender Directive and the decision of the Court of Justice in Association Belgedes Consommateurs Test-Achats ASBL v Council of Ministers is quite simply misconceived.
4.17 It is submitted by the Respondent that the Complainant has failed to establish a prima facie claim of discrimination.
4.18 The respondent submits that in circumstances where the Complainant to not proceed to a final quotation and failed to take out any insurance policy with the Respondent, he is not entitled to maintain these proceedings as no goods or service have been disposed to him which is a
requirement as per section 5(1) of the Acts for discrimination to arise.
4.19 It is submitted by the Respondent that the Complainant has failed to demonstrate that the
treatment received by the Complainant was less favourable that the treatment someone not
covered by that ground would have received in similar circumstances. In particular, the
Complainant asserts that he was discriminated against on the grounds of race. It is the
Respondent’s position that the price differential which the Complainant alleges is discriminatory is not based on race, but relates to the country in which the licence was issued. Therefore, an
Irish person with a non-Irish or UK driving licence would be treated in exactly the same
manner as the Complainant. Therefore the type of conduct in respect of which the Complainant
alleges is not prohibited conduct for the purposes of the Acts.
Indirect Discrimination
4.20 The respondent submits that in order to establish a prima facie case of indirect discrimination the Complainant is required to establish that the “provision” put him at a “particular disadvantage” as compared to other persons. The respondent submits that no such evidence has been presented.
Objective justification
4.20 It is further submitted that to the extent that the WRC determines that the price differential may constitute indirect discrimination, the Respondent submits that:
(a) that the discrimination is objectively justified by a legitimate aim (i.e., that the aim
behind the provision is unconnected with the prohibited ground in question); and
(b) that the means by which the legitimate aim is pursued is appropriate and
necessary.
4.21 In this regard, the clear inability on the part of the Respondent to validate the driving experience and penalty points of the Complainant and other non-Irish licence holders, is an extremely legitimate objective. Given that the Complainant was in a position to apply for an Irish licence, any disadvantage could be overcome by this act.
4.22 In the present case, it is clear that the price differential applied by the Respondent is
objectively justified by a legitimate aim. There is no question but that it is legitimate for the
Respondent to, for commercial reasons and validation difficulties, determine its premiums for
car insurance on the basis of risk characteristics which are objectively justified by actuarial and
statistical data.
Given the lack of ability of the Respondent to validate the driving record and penalty points of the Complainant, the higher premium is the only manner in which premiums could be offered to non-Irish driving licence holders. This premium is justified by the higher level of claims maintained by non-Irish licence holders.
4.23 Without prejudice to the contention of the Respondent that any indirect discrimination can be objectively justified the Respondent herein also relies on section 5(2) in its defence of any
discrimination established by the Respondent.
5 CONCLUSIONS OF THE EQUALITY OFFICER
5.1 The matter referred for investigation turns upon whether or not the complainant was discriminated against contrary to Section 3(1)(a) and 3(2)(h) of the Acts. In reaching my decision I have taken into account all the submissions, both oral and written, made to me by the parties in the course of my investigation into the complaint.
5.2 Section 3(1)(a) provides, inter alia, that discrimination shall be taken to occur where: “On any of the grounds specified... (in this case the race ground).... A person is treated less favourably than another person is, has been or would be treated.
Section 3(2) provides that: as between any two persons, the discriminatory grounds ...are ... (h) that they are of different race, colour, nationality or ethnic or national origins (the ”ground of race”),”
The complainant in this instance framed his complaint on the basis of different treatment due to the presentation of an EU versus an Irish licence. The complainant is administratively categorised by the respondent as an EU licence holder on the basis of her Polish licence. I accept that not all driving licence holders are of the same nationality as the issuing authority. However I find that a reasonable person would impute a nationality to an individual based on the county or origin of such official documentation, in the absence of any other evidence. I find that there is a reasonable connection with nationality in this complaint and therefore I find that this complaint is on the ground of race.
5.3 Section 5(1) provides that:
A person shall not discriminate in disposing of goods to the public generally or a section of the public or in providing a service, whether the disposal or provision is for consideration or otherwise and whether the service provided can be availed of only by a section of the public.
5.4 The burden of proof is set out in Section 38A which provides that:
" Where in any proceedings facts are established by or on behalf of a person from which it may be presumed that prohibited conduct has occurred in relation to him or her, it is for the respondent to prove the contrary."
Although the instant case is taken under the Equal Status Acts, Section 38A is analogous to Section 85A of the Employment Equality Acts. In this regard, I consider that it is appropriate for me to consider the Labour Courts comments in examining the circumstances in which the probative burden of proof applies in employment equality cases. In the case of Dyflen Publications Limited and Ivana Spasic (ADE/08/7) the Court adopted the approach of Mummery LJ in Madrassy v Nomura International plc [2007] IRLR 246, and stated that “… the court should consider the primary facts which are relied upon by the complainant in their proper context. It also indicates that in considering if the burden of proof shifts the court should consider any evidence adduced by the respondent …”.
Section 85A of the Act provides for the allocation of the probative burden in cases within its ambit. This requires that the Complainant must first establish facts from which discrimination may be inferred. What those facts are will vary from case to case and there is no closed category of facts which can be relied upon. All that is required is that they be of sufficient significance to raise a presumption of discrimination. However they must be established as facts on credible evidence. Mere speculation or assertions, unsupported by evidence, cannot be elevated to a factual basis upon which an inference of discrimination can be drawn. Section 85A places the burden of establishing the primary facts fairly and squarely on the Complainant and the language of this provision admits of no exceptions to that evidential rule.
Indirect Discrimination.
5.5 It is agreed that the complainant obtained two different quotes for the same service. I note that in this case the complainant was asked to confirm the country of issue of the driving license. In the instant complaint the respondent has provided a higher quote based on the country of origin of the complainant’s documentation. I am satisfied that the complainant has established facts from which it may be presumed that prohibited conduct has occurred in relation to him and he has established a prima facie case of indirect discrimination on the ground of race. However, the respondent can successfully rebut this prima facie case if it can show that the neutral provision in question is objectively justified by a legitimate aim and the means of achieving that aim are appropriate and necessary.
5.6 Section 3(1)(c) of the Equal Status Acts provides:
(c) where an apparently neutral provision puts a person referred to in any paragraph
of section 3(2) at a particular disadvantage compared with other
persons, unless the provision is objectively justified by a legitimate aim and
the means of achieving that aim are appropriate and necessary.
At the hearing of this compliant direct and extensive evidence was given for the respondent by their Manager of Pricing and the Manager of Underwriting regarding their business process and pricing policies and I accept their accounts. I accept the respondent’s position that in order to deal with the widespread issue of non-disclosure that the respondent, uses vehicle databases to verify vehicle information including the Integrated Information Data Services (the “IIDS”) for verification. I accept the position that given the lack of ability of the Respondent to validate the driving record and penalty points of the Complainant, the higher premium is the only manner in which premiums could be offered to non-Irish driving licence holders.
I accept the account put forward by the respondent and I find the following are the relevant facts in this case.
· The Complainant engaged in Stage 1 and 2 only of the respondent’s process and as such obtained an indicative quote.
· The respondent will not provide a quote to potential customers who have excessive penalty points and verification of points is therefore a very serious matter for the respondent. A discount is available if a potential customer has no (or limited) penalty points. It is reasonable approach by the respondent that independent verification is obtained.
· Verification of penalty points is independently and immediately available to the respondent for NDLS licences. This facilitates the use of a website to provide quotations.
· Verifiable relevant data was not available to the respondent. An administrative efficiency has arisen, outside of the control of the respondent which allows such data to become available. The complainant can at any time easily obtain a NDLS licence and avail of the same administrative efficiency and resulting discount, but he chooses not to do so.
· I am satisfied that the respondent’s policy of verifying penalty points was put in place to achieve a legitimate aim and the means of achieving that aim are appropriate and necessary.
Ultimately, I find that the race of the complainant is not a risk characteristic used by the respondent to determine the price of policies offered.
6 Decision
6.1 In reaching my decision, I have taken into account all the submissions, written and oral that were made to me. In accordance with section 25(4) of the Equal Status Acts, I conclude this investigation and issue the following decision.
6.2 I find that the complainant has established a prima facie case of indirect discrimination on the ground of race and that the respondent has successfully rebutted the allegation of discrimination.
6.3. Accordingly, I find in favour of the respondent in this case.
______________
Peter Healy
Adjudication Officer
22nd April 2016