Auto Insurance by Gender

Why do men pay more for auto insurance? This guide seeks to provide insight into why women pay less.

Auto Insurance by Gender

In Canada, just as in many other countries, there are a lot of factors that insurance companies take into consideration when determining how much a person will pay for auto insurance. These factors will include the amount of time they travel, the type of vehicle they own, their age, and previous driving record. At times though, people wonder if the gender of the driver is also something that is taken into consideration. And, if this is the case, what does this mean for insurance rates for women in Canada?

Research shows that women can expect to pay a significantly lower amount on their car insurance premium. This is regardless of the type of insurance that they have. For example, research has shown that women in Canada will pay on average around 5 per cent less than their male counterparts for automobile insurance. This same principle applies to homeowner's insurance where women in Canada on average will pay 8 per cent less. The most striking difference can be seen when looking at the amount that women will pay for life insurance in Canada. Based on a study done by InsurEye Inc. on average, women can expect to pay 25 per cent less for life insurance.

Why do women pay less?

Why the difference? It comes down to accidents. Insurance companies consider women to be less of an accident risk in Canada simply because on average women have fewer car accidents than men. Additionally, when women do have accidents, their claim amounts are significantly lower. On average, a man living in Ontario, Canada will spend $151 for their insurance premium while a woman will spend approximately $146.

In addition to having fewer automobile accidents, women have been shown to be more likely to drive within the posted speed limits. The top five reasons why people had increased insurance rates were due to speeding over the posted limit, failure to obey traffic signs, minor traffic infractions, failure to wear seat belts, and failure to drive with proof of insurance. For each one of these infractions, men were more likely to commit them than women.

Insurance companies will look at all of these factors and statistics when deciding how much to charge a person for their insurance premium. While there are very few insurance companies who will offer specific premiums to individuals based on their gender, gender is definitely something that is taken into consideration. A spokesperson for a major insurance company in Canada said that using these statistics is a necessary evil as it often sheds light on certain trends and patterns of behavior that can affect a driver's performance behind the wheel and their chances of getting into an automobile accident.

As long as the statistics stay intact, we would expect to see females enjoying slightly less cost for their automobile insurance needs.

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