Younger female motorists could suffer premium hikes of 11% or more after a European Union ruling preventing insurers from using gender when risk rating comes into effect later this year.

An economic analysis found that women could see term life insurance premiums rise by around 30% or more, while men could see a reduction in pension income from annuities of around 5% or more.

The European Insurance and Reinsurance Federation (CEA) says the changes in premium are likely to affect consumer demand and deter people from saving for old age.

Last year the European Court of Justice ruled that from December this year European insurers will no longer be able to consider gender when pricing risks.

“The ban on gender in insurance pricing may have a number of potential unintended negative consequences for consumers, insurance markets and society more generally,” CEA Director General Michaela Koller said.

“The use of evidence-based statistics is indispensable in actuarial science, and the study proves that gender is one of the factors that has an obvious impact on the risks to be covered in such products as annuities, term-life and motor insurance.”

With the EU now proposing an anti-discrimination directive on age and disability, the CEA has commissioned a study into the likely pricing impact of any restriction on the use of those factors when risk rating.

“A ban on the use of age or disability would undermine the insurance business model as it currently exists, to the detriment of consumers,” Ms Koller said. “Such a ban would have a massive impact on the affordability and availability of insurance.”