Should Women Pay More for Disability Insurance? Part 2

In a previous post, we discussed how a woman with the same age, job and health history as a man can end up paying an average of 25% (and in some cases, 60%) more for the same level of disability insurance protection.  We also discussed how some insurance companies raise premiums based on conditions unique to one’s sex, such as pregnancy.

When we first addressed this issue, the Massachusetts legislature was considering a bill that prohibited insurers from charging higher rates to women than to men.  At the time, Massachusetts law prohibited insurance companies from using race and religion as rating factors when determining the cost of insurance, but there was no law against using gender as a rating factor.

Recently, the Massachusetts Senate voted to approve a budget amendment adding gender to other rating factors that insurance companies are not allowed to consider when determining the cost of premiums.  The bill passed by a wide margin:  32 senators in favor of the amendment, and only 6 senators voting against the amendment.

It will be interesting to see if, in the future, other states follow suit and start to pass laws requiring insurance companies to give men and women the same premium rates for the same level of disability coverage.