New Zealand’s Vero is dropping a long-standing industry practice of comparing male and female customers even though gender and age together help to determine the likelihood of a claim, and gender has a significant price impact for some age ranges.

After consulting with Vero’s LGBTIQ+ employee resource group Amplify, the insurer's product team decided to strip out gender from its underwriting data and pricing on car insurance products.

The complex process will take at least 12 months.

Vero Executive Manager Consumer Insurance Sacha Cowlrick says binary distinctions are not a true reflection of the gender spectrum of its customers.

“New Zealanders identify with a much broader range of gender identities,” she said. “We have made the decision that it is simpler and more inclusive to begin removing gender from our underwriting.”

The long lead time to make the change was to manage the knock-on effect to premiums. Vero will undertake lengthy work to “smooth” pricing differences to ensure that when gender is removed as a factor altogether, it won’t create any sudden premium changes customers aren’t prepared for.

“If we were to remove the gender rating on premiums suddenly, it would mean big changes to some customers’ premiums at renewal,” Ms Cowlrick said.

In other changes to create a more inclusive experience, Vero is looking at how customers are named in letters and policy documents and the Amplify group is working on a guide for customer-facing employees to better serve non-binary customers.

“This is a journey and it may take time for our business,” Ms Cowlrick said. “I’m proud that Vero is taking steps towards providing more inclusive products and services.”