Complainant

Respondent

Parties

Liam  Scott

Allianz PLC

Representatives

John Lynch Whitney Moore Solicitors

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Section 21 Equal Status Act, 2000

CA-00041316-001

26/11/2020

The respondent is one of the leading providers of insurance, including car insurance, in Ireland and Europe.   The complainant submitted a complaint under Section 21 of the Equal Status Act, 2000, to the WRC which was received on 26 November 2020. A remote hearing of the case took place on 7 March 2022.

The matter was heard by way of remote hearing on 3 November 2021 pursuant to the Civil Law and Criminal Law (Miscellaneous Provisions) Act 2020 and S.I. 359/2020, which designated the WRC as a body empowered to hold remote hearings.

In deference to the Supreme Court ruling, Zalewski v Ireland and the WRC [2021] IESC 24 on the 6th of April 2021 the Parties were informed in advance that the Hearing would be in Public, Testimony under Oath or Affirmation would be required and full cross examination of all witnesses would be provided for.

 The required Affirmation / Oath was administered to all witnesses. The legal perils of committing Perjury were explained to all parties.

 Full cross examination of Witnesses was allowed.

The Respondent submits that the complainant failed to adhere to the requirements of  Section 21 (2) of the Act. The respondent submits that the complainant did not notify the Respondent within the required 2-month period as required as the complainant claims the date of discrimination to be his 70th birthday which was on 30 July 2020. Nor, the respondent submits, was there any application made by the complainant to extend time for exceptional circumstances.

In response to this Preliminary Point, the complainant submits that although his 70th birthday was on 30th July 2020, he only became aware that there might be a difficulty regarding his use of his wife’s Open Driving Option on 8th October 2020, when his wife’s policy was renewed. He wrote to the respondent on that date seeking clarification on the situation. The respondent replied by letter dated 23 October 2020, stating that “the open drive benefit we offer to customers is restricted to drivers aged between 30 and 70.” The complainant replied by letter to respondent on 24th October 2020, outlining his views on the matter and stating that it was his intention to lodge a formal complaint under the Act. 

Section 21 of the Act states:

Redress in respect of prohibited conduct.

21.—(1) A person who claims that prohibited conduct has been directed against him or her may, subject to this section, seek redress by referring the case to the Director of the Workplace Relations Commission.

(2) Before seeking redress under this section the complainant—

(a) shall, within 2 months after the prohibited conducted is alleged to have occurred, or, where more than one incident of prohibited conduct is alleged to have occurred, within 2 months after the last such occurrence, notify the respondent in writing of—

(i) the nature of the allegation,

(ii) the complainant’s intention, if not satisfied with the respondent’s response to the allegation, to seek redress under this Act,

and

(b) may in that notification, with a view to assisting the complainant in deciding whether to refer the case to the Director of the Workplace Relations Commissioner, as the case may be, the Circuit Court, question the respondent in writing so as to obtain material information and the respondent may, if the respondent so wishes, reply to any such questions.

(2A) For the purposes of subsection (2) the date of notification is the date on which the notification is sent, unless it is shown that the notification was not received by the respondent.

Having considered this matter carefully I am content that the complainant has satisfied the requirements of the Act in relation to notification of the respondent as laid down in Section 21.  As soon as the complainant became aware that there might be a difficulty vis-à-vis the open driving option, he sought clarification from the respondent on the matter. As soon as it was confirmed that there was indeed a prohibition on him utilising the open driving option he wrote, as required, to the respondent informing them that it was his intention to lodge a formal complaint.  I am satisfied the

timeline satisfies the requirements the Act.

Additionally, I find that the complainant’s case refers to an alleged ongoing discrimination. It is evident that some acts of discrimination are not limited to specific events but may take place within an ongoing relationship.  Section 21 (11) of the Act covers such a situation:

For the purposes of this section prohibited conduct occurs—

(a) if the act constituting it extends over a period, at the end of the period,

(b) if it arises by virtue of a provision which operates over a period, throughout the period.

In this case the open driving option operated throughout the duration of the complainant’s wife’s contract therefore a complaint could have been referred within six months of the termination of the contract.

The respondent submits that the complaint is misconceived as the respondent was not providing a service to the complainant.  The respondent refers to section 2 of the Act which provides that service means, “a service or facility of any nature which is available to the public generally or to a section of the public, and without prejudice to the generality of the foregoing, includes- (b) facilities for banking, insurance, grants, loans, credit or financing.

Section 3 provides that for the purposes of this Act discrimination shall be taken to occur where a person is treated less favourably than another person is, has been or would be treated in a comparable situation.  The respondent submits that the service provided in this instant case (the provision of insurance) was to the policy holder, the complainant’s wife, under a specific policy. This, the respondent submits, formed a contract between the respondent and the policy holder. As part of this policy, the policy holder was given the benefit of open driving for those over 30 and under 70 years of age who were driving with the policy holder’s consent. The complainant’s complaint is that he was no longer insured under the policy holder’s policy. The respondent submits that it was not providing a service to the complainant as the insurance cover was for provided for the policy holder,

the complainant’s wife. The cover provided on the open policy was an additional benefit on the

policy to which terms and conditions can apply. The respondent submits that the complainant was not discriminated against by the respondent.

In response to this Preliminary Point, the complainant stated that the Act refers to a service or facility that is provided to the public generally.  In this case as he has the policy holder’s permission, he is entitled to the service, but that service is being denied to him because of his age.

Section 2 of the Act states:

“service” means a service or facility of any nature which is available to the public generally or a section of the public, and without prejudice to the generality of the foregoing, includes—

(a) access to and the use of any place,

(b) facilities for—

(i) banking, insurance, grants, loans, credit or financing,

(ii) entertainment, recreation or refreshment,

(iii) cultural activities, or

(iv) transport or travel,

(c) a service or facility provided by a club (whether or not it is a club holding a certificate of registration under the Registration of Clubs Acts, 1904 to 1999) which is available to the public generally or a section of the public, whether on payment or without payment, and

(d) a professional or trade service,

but does not include pension rights (within the meaning of the Employment Equality Act, 1998) or a service or facility in relation to which that Act applies;

Having considered the matter, I am content that the complainant is the person who is being denied

a service which is available to the public generally, albeit with the policy holder’s permission.

The complainant presented a detailed written submission.

The complainant submits that on the 8 October 2020 he became aware that he might be excluded from using an Open Driving Option on his wife’s car insurance based entirely on his age.  The complainant sought to clarify the issue through correspondence with the respondent.

The complainant submits that the respondent confirmed that age was the only basis on which he was excluded from using the Open Driving Option. On 26 November 2020 the complainant lodged a formal complaint with the WRC claiming that he had been discriminated against on the grounds of age.

By way of background the complainant submits that:

On 8 October 2020, he wrote to the respondent looking for confirmation that he was covered to drive his wife’s car under the terms of her policy with the respondent, as he had been the previous year.

On 31 October 2020, the complainant received a letter from the respondent informing him that he was not covered by his wife’s insurance because of his age.

On 24 October 2020, the complainant wrote to the respondent pointing out that their proposed action was discriminatory and contrary to legislation prohibiting discrimination on the basis of age.

On 5 November 2020, the respondent replied to the complainant confirming that age was the only deciding factor in not providing the driving cover.

On 10 November 2020, the complainant wrote to the respondent stating that if the respondent had no other basis for not providing him with cover than age, he would pursue the matter under equality legislation.

On 7 December 2020, not having received a response to his previous letter, the complainant wrote to the respondent informing them that he had lodged a complaint with the WRC.

On 7 December 2020, the complainant wrote to the WRC stating that the respondent had at all times been given time to respond to hies queries and that they had been informed both of his intention to submit a formal complaint and when the formal complaint had been made.

The complainant submits that in a letter dated 5 November 2020 regarding the Open Driving Option, the respondent stated, “as we do not know who these drivers are and have no information related to them, we apply restrictions based on their age.”  The complainant submits that this statement clearing indicates that there is a difference in treatment based on age.

Further, the complainant submits that the courts have consistently held that the principle of equal treatment requires that comparable situations must not be treated differently.  In this case the complainant submits that the respondent has been helpful in that it has identified the following:

(a)    they do not know who any of the drivers are (regardless of age) who use the Open Driving Option and so in that context all potential drivers are comparable.

(b)    Because of (a) they have no (actuarial) information related to any (any of) them.  Again because of this, all drivers are directly comparable.

(c)     Because of (b) they have unilaterally decided to use only one factor, which is age, anyone over 70.

The complainant submits that the respondent has no information on any of the drivers who are using or have used the Open Driving Option so therefore those over 70 are directly comparable in this context to those under 70 but they have decided to exclude those over 70 years of age.

The complainant contends therefore that discrimination based on age has occurred.

The complainant submits that such discrimination is contrary to Article 21 of the EU Charter of Fundamental Rights.

The complainant submits that whereas discrimination on age to exclude older people from entitlements such as Open Driving may be provided by Irish Law by way of derogation, any limitation of the exercise of rights and freedoms recognised by the Charter of Fundamental Rights,  (i) must be provided for by law (ii) must respect the essence of those rights and freedoms (iii) are subject to the principle of proportionality (iv) may be made only if they are necessary and (v) must genuinely meet objectives of general interest recognised by the Union (vi) or genuinely meet the need to protect the Rights and Freedoms of others. The complainant contends that in this case any derogation does not

pass these tests.

The complainant submits that in 2004, the Council of the EU adopted a Directive implementing the principle of equal treatment of men and women in terms of access to the supply of goods and services including insurance.  Member states are not allowed to derogate in their national legislation from the principle that there exists “Fundamental Rights”.  No EU legislation can be adopted that conflicts with the rights and principles guaranteed by the Charter.  Any such “opt out” clause, according to the complainant, is thus illegal.

The complainant submits that if the respondent contends that under Irish Law they are allowed to discriminate on the basis of age and yet this is not allowed under EU law, this implies that Irish law has not been implemented correctly.  If this is the case the complainant submits the WRC has the right to set aside or disapply/ignore national law that is contrary to EU law.

Regarding the use of actuarial factors, the complainant contends that Article 5 (1) of Directive 2004/113 tackled the use of actuarial factors in calculating the differences in premiums and benefits arising from sex, as a factor.  The use of actuarial factors related to sex was widespread in the provision of insurance services at the time the Directive was adopted. The Directive allowed for a transition period but the use of sex as a factor was to be abolished by 21 December 2012, at the latest.  There was however a derogation under Article 5 (2) allowing some member states the use of an option to permit insurers to apply unequal treatment, without any temporal limit. However, the complainant submits that this option only allows “exemptions”.  The fact that there are risk differences supported by actuarial data does not entitle insurance companies to ignore the Charter of Fundamental Rights. The complainant submits that age must be treated in the same manner as sex in this context; age and sex are each just two of the Fundamental Rights enshrined in the Charter of Fundamental Rights.

Notwithstanding the above, the complainant submits that national statistics based on data supplied by RSA/CSO clearly shows that with regard to collisions, where persons are killed or injured approximately 90% of such accidents are caused by drivers under 70 years of age.

The complainant submits that the respondent has breached other important articles of the EU’s Charter of Fundamental Rights. Firstly, dignity, as ageism is a direct assault on a person’s dignity. Secondly, ageism is an attack on a person’s right for their physical and mental integrity. Thirdly, it is an attack on the rights of the elderly.

In conclusion, the complainant submits that the restriction on Open Driving is based on no other factor or consideration other than his age, as confirmed by the respondent, and is discriminatory. Such discrimination would not be allowed on other grounds.  Such ageist attitudes are not just limiting but shorten lives.  Policies such as this are an assault on the dignity and independence of older people.

The complainant submits that age-based distinctions are similar to all other discriminatory acts.  They are based upon demeaning stereotyping and prejudice.  Age is used as a proxy that particular groups, older people, possess certain characteristics in very general and sweeping terms.  Discrimination based on age is a violation of a person’s fundamental rights.

The complainant also presented statistics which he submits imply that those over 70 were responsible for less than 10% of all collisions, in a thirteen-year period from 2007 to 2019, where 89.2% of the accidents recorded (where an individual was injured or killed) were caused by people who were under the age of 65.

The respondent provided a detailed written submission.

By way of background, the respondent submits that a letter was received from the complainant on 8 October 2020 in relation to the fact that since his 70th birthday on 30 July 2020, he was “no longer insured” under his wife’s “open driving” insurance. The respondent replied on 23 October confirming that the open drive policy benefit it offers to policy holders is restricted to drivers aged 30 to 70 years and that as it was a benefit on those policies, the respondent was entitled to apply terms and conditions.  The letter went on to confirm that the restriction only applied to open driving and not to policy holders or drivers named on the policy.

The complainant wrote to the respondent on 24 October informing them that he would be lodging a formal complaint under the Equal Status legislation. The complainant sought evidence to substantiate the position being adopted by the respondent.  The respondent replied on 5 November explaining that they were not restricting customers but were applying limitations to those who can drive under open driving. The letter explained that “open driving” allows insured cars to be driven by a wide range of individuals not named on the policy. As the respondent has no information on these drivers, they apply restrictions based on age.  The letter went on to confirm that these restrictions were commonplace in the insurance markets.  Information on rating factors is commercially sensitive and therefore no specific information could be released.

The respondent submits that in order to consider criteria for policy cover extensions a technical analysis refresh is carried out on an annual basis. This informs the refreshing of the rating tariffs, the acceptance criteria as well as the criteria the respondent applies in relation to cover extensions. All technical analysis performed is internally peer reviewed and any changes to rating, acceptance or cover adheres to the Product Oversight and Governance Policy. The respondent also undergoes review of the technical analysis framework on a 3-year cycle from the respondent’s Group company and follows group best practice methodologies. The respondent is also subject to periodic internal audit reviews as well as themed Central Bank assessments. 

The respondent submits that analysis of demonstrates that the experience for main drivers aged between 30 and 70 years of age does not vary significantly, but that main drivers below the age of 30 and above the age of 70 have significantly worse claims experience.

The respondent’s approach in relation to the age band that is offered open driving cover is based on the assumption, that due to the fact that main drivers aged 70 or over perform much worse that main drivers aged between 30 and 70 years of age, they would expect someone age over 70 who drives a vehicle under an open driving extension would be expected to perform worse than someone aged between 30 and 70 years of age who drives under an open driving cover extension.

The respondent submits that actuarial assessment does not lead to a belief that there would be any reduction in the use of the open driving cover extension if it was for an age band 30 plus and they do not believe that there would be any improvement in the relative driving performance.  The open driving cover extension only applies to drivers aged between 30 and 70 years of age who have a full clean driving license where performance is expected to be similar based on the actuarial analysis referred to above. Given these criteria the respondent can set a given price to cover the cost of this extension.  The respondent submits that, if cover were required for additional drivers below the age of 30 or above the age of 70 or for a driver without  their full licence it would not be possible to price the additional cover effectively and fairly for this increased level of risk without obtaining individual driver details on additional persons who would drive the vehicle who do not fall within the standard open driving criteria; for this reason it is not possible for the respondent to sell an unrestricted open driving cover extension.

The respondent submits that their approach is backed up by the NDLS who require renewal of driving licences above the age of 70 on a more regular basis subject to medical fitness assessments from a medical practitioner because driving performance deteriorates above the age of 70.

The respondent submits that limiting the benefit of the open policy cover to those between 30 and 70 years of age is not discrimination.   According to the respondent if the complainant, or anyone else under 30 or over 70 wishes to drive the policy holder’s car they can become a named driver in which case they can provide relevant information to the respondent for them to assess risk and quote accordingly. Where a policy holder wants a person to drive under an open cover benefit, the respondent has no information in relation to those drivers.  In order to assess this risk, the respondent is entitled to assess the data collected and analysed by them.  The data considered by the respondent is reasonable data to rely upon. It is the respondent’s own data covering 1.7m policy exposure years in the data and 55,000 claims (excluding windscreen claims) drawn from 760,000 Allianz customer policies across the years 2011-2019. The respondent submits that from a commercial perspective it is essential that an insurance company such as the respondent be permitted to assess risk fairly on the basis of statistical and actuarial analysis. The respondent is a commercial enterprise.  Therefore, it is entirely appropriate (in light of the above data and analysis) for the respondent to put an age limit on the benefit given to a policy holder of an open drive cover where no information in relation to potential drivers is required.

The Head of Pricing Actuary for the respondent, Mr John Ryan, gave detailed evidence at the hearing explaining the methodology utilised to set the premiums annually.  Mr Ryan explained what statistics are used and how they are analysed.  He stated that the figures put forward by the complainant to support his case were “misleading and irrelevant”.  He stated that the respondent needs to price its policies fairly.  This can be done for those between 30 and 70 years of age but if you wish to provide cover for drivers outside of that range you need further information on them, therefore drivers over 70 years of age have to be named and can then be priced fairly. Mr Ryan stated that if the respondent was unable to rate on age it would not be possible to give a fair and equitable price to customers.  If this were to happen the system would break down.

In response to questions in cross examination, Mr Ryan stated that the statistical data put forward by the complainant was not “normalised”, and therefore not relevant statistically. He did agree however that this was his interpretation only.

In conclusion, the respondent submits that it has put age restrictions on the open cover benefit based entirely on actuarial evidence indication that those under 30 and over 70 years of age have significantly worse claims experience. Actuarial evidence is relevant. This is covered by Section 5(1)(d) of the Acts and is not discrimination.

I have considered this matter very carefully.

Section 38A of the Equal Status Act, 2000, states:

Burden of proof.

38A.—(1) 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.

First, I must assess whether the complainant has succeeded in establishing a prima facie case. In order to do so the complainant must satisfy three criteria in relation to his complaint. He must (1) establish he is covered by a discriminatory ground (in this case age ground); (2) it must be established that the specific treatment alleged by the complainant actually occurred and (3) there must be evidence that the treatment received by the complainant was less favourable than the treatment someone who was not covered by the discriminatory ground would have received in similar circumstances.

So, has the complainant establishes facts from which it may be “presumed” that there has been direct or indirect discrimination?

I find he has.  The complainant is 70 years old and precluded from availing of the open drive option included in his wife’s insurance policy because he is that age. It is clear and not contested that the respondent imposes a limitation on the Open Driver Option based purely on age. It is clear he was treated less favourably than a comparator within the age range of 30 to 69 years of age.  This being the case it is for the respondent to prove that their limitation is not in breach of the Act.

The respondent points to section 5 of the Act, which they say allows them discriminate on age grounds and that they are not in breach of the Act when applying limitations on the Open Driver Option of motor insurance policies. 

Section 5 of the Act states:

(1) 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.

(2) Subject to subsections (4) and (4A), subsection (1) shall not apply in respect of—

(a) an activity referred to in section 7(2),

(b) a service related to a matter provided for under section 6, or a service offered to its members by a club in respect of which section 8 applies,

(c) differences in the treatment of persons on the gender ground in relation to services of an aesthetic, cosmetic or similar nature, where the services require physical contact between the service provider and the recipient,

(d) differences in the treatment of persons in relation to annuities, pensions, insurance policies or any other matters related to the assessment of risk where the treatment—

(i) is effected by reference to—

(I) actuarial or statistical data obtained from a source on which it is reasonable to rely, or

(II) other relevant underwriting or commercial factors,

and

(ii) is reasonable having regard to the data or other relevant factors,

It should be noted that section 5(2)(d) of the Act provides that the general prohibition on discrimination does not apply to differences in the treatment of persons, in relation to, inter alia, “insurance policies or any other matters related to the assessment of risk” where the treatment is effected by reference to reasonably reliable actuarial or statistical data or other relevant underwriting and commercial factors and where it is reasonable having regard to those data and factors.  Special provisions are made for this exemption in the context of discrimination on the ground of gender in section 5(2)(da) and section 5(3).

In order to avail of the exemption a respondent must show that a difference in treatment is (1) effected by reference to actuarial or statistical data which was obtained from a source on which it was reasonable to rely and is reasonable having regard to the data or other relevant factors or (2) is effected by reference to other relevant underwriting or commercial factors and it is reasonable having regard to the data or relevant factors.

Therefore, I have to assess (1) whether the method employed by the respondent provides actuarial or statistical data upon which it is reasonable to rely in setting the premiums quoted to the complainant in this case (2) and/or whether the method employed by the respondent or whether there are other relevant underwriting or commercial factors upon which it is reasonable to rely having regard to the to the data or relevant factors.

I relation to (I) and (2) above, I have given careful consideration to the information submitted by the respondent and the evidence given by Mr Ryan, the Head Pricing Actuary.  Mr Ryan’s evidence was clear and cogent, his in-depth understanding of the methodologies utilised was evident.  He is a highly qualified actuary and a credible witness.  I am satisfied that the information submitted by the respondent allied to Mr Ryan’s testimony clearly demonstrate that the method used by the respondent provides actuarial and statistical data upon which it is reasonable to rely upon in setting the premiums and limitations of an insurance policy with regard to the Open Driver Option. I also find that there are other relevant underwriting or commercial factors upon which it is reasonable for the respondent to rely.  I am therefore satisfied that the respondent is entitled to avail of the exemption allowed in section 5 of the Act.

Even if less favourable treatment was established under Section 5(1) of the Act, the meeting of the conditions set out in Section 5 (2) (d) dictate that such treatment is not discriminatory. 

For the sake of completeness, I would like to refer to the complainant’s reference to Article 21 of the EU Charter of Fundamental Rights and his assertion that the Equal Status Act is out of step with European Law.  The Charter of Fundamental Rights of the European Union states that everyone is equal before the law (Article 20) and that any discrimination, including age discrimination, is prohibited (Article 21). Article 25 of the Charter explicitly recognises and respects the right of older people to lead a life of dignity and independence and to participate in social and cultural life. However, the application of this in the EU through the horizontal anti-discrimination directive (COM(2008)0426) is currently blocked in the Council.

I find the respondent did not engage in prohibited conduct.

Age discrimination, insurance,