Parliament bans age discrimination in vehicle insurance

Cyprus’ House of Representatives has approved new legislation aimed at preventing insurance companies from refusing vehicle coverage solely on the basis of a driver’s age. The proposal, introduced by Nicosia MP Alexandra Attalides, was adopted with 49 votes in favor and one vote against.

The law establishes that age by itself cannot be used as grounds for denying motor insurance. While insurers will still be able to assess risk using actuarial methods, they will now be required to provide clear and documented explanations if they refuse to issue or renew a policy.

The legislation also introduces administrative penalties for companies that fail to comply. In addition, insurers must inform applicants of the reasons behind any refusal and provide justification within a defined timeframe when terminating an existing policy.

During parliamentary committee discussions, the bill was amended to strengthen its provisions. The final text explicitly bans age-based discrimination in vehicle insurance and allows the temporary continuation of an existing policy while issues are being resolved. It also establishes a formal process through which affected policyholders can submit complaints, while requiring insurance companies to report relevant data annually.

Attalides argued that the measure addresses a long-standing problem faced by many older drivers, particularly those over 70. She noted that despite their relatively low involvement in road accidents, many elderly drivers in Cyprus encounter refusals of coverage or significant increases in premiums. According to her, compulsory vehicle insurance is essential for maintaining personal independence, and the law aims to ensure fair treatment rather than eliminate risk assessment altogether.

Several MPs emphasized that the issue is particularly serious in Cyprus due to the country’s limited public transportation system. They said that when elderly citizens are unable to secure insurance, they risk becoming isolated from everyday activities and services.

Some lawmakers also pointed to cases in which older drivers have been charged premiums of €700 to €800 despite having no accident history. They argued that in many other countries drivers with safe records often benefit from lower insurance costs rather than facing higher charges as they age.

A proposal from the Democratic Rally (DISY) party sought to change the requirement that insurers automatically provide written explanations for policy changes. The amendment suggested that justification should only be given if requested by the policyholder, to reduce administrative costs for insurance companies. However, this amendment was ultimately rejected by the House.

Supporters of the legislation described it as a step toward greater transparency and accountability in the insurance sector. Some MPs also framed it as a broader legal principle that strengthens protections against discrimination in private contractual relationships.

At the same time, several lawmakers urged insurance companies not to shift any additional administrative costs onto other policyholders. Others suggested that the government should examine the possibility of subsidizing premiums for pensioners with limited income.

Research cited during the debate indicated that in many European Union countries age is not treated as a primary factor in determining vehicle insurance eligibility. Instead, insurers typically rely on criteria such as accident history, driving record and vehicle characteristics.

The newly adopted law is intended to bring Cyprus closer to those practices while ensuring that insurance decisions affecting older drivers are properly justified and transparent. Non-compliant insurers could face administrative fines under the new framework.