CITATION: Auto & General Insurance Company Limited v President, Anti-Discrimination Board [2010] NSWADT 229 DIVISION: Equal Opportunity Division FIRST APPLICANT Auto & General Insurance Company Limited SECOND APPLICANT A & G Insurance Services Ltd PARTIES: THIRD APPLICANT Australian Insurance Holdings Pty Ltd RESPONDENT President, Anti-Discrimination Board FILE NUMBER: 091142 HEARING DATES: 7 June 2010 SUBMISSIONS CLOSED: 7 June 2010 DATE OF DECISION: 14 September 2010 BEFORE: O'Connor K - DCJ (President) CATCHWORDS: EQUAL OPPORTUNITY – Motor Accident Insurance – Proposal to set premiums by reference to insured's marital or domestic status – Application for exemption – Refused by President, Anti-Discrimination Board – Refusal affirmed – Anti-Discrimination Act 1977, s 126 - Anti-Discrimination Regulation 2009, cl 5 Administrative Decisions Tribunal Act 1997 Anti-Discrimination Act 1977 Anti-Discrimination Act 1998 (Tas) LEGISLATION CITED : Anti-Discrimination Regulation 2009 Discrimination Act 1991 (ACT) Equal Opportunity Act 1984 (WA) Equal Opportunity Act 1995 (Vic) ADI Ltd and Equal Opportunity Commission [2005] WASAT 49 Australian Grand Prix Corporation [2006] VCAT 2193 Beach House Group Pty Ltd [2006] QADT 30 Boeing Australia Holdings Pty Ltd [2003] QADT 21 Boeing Australia Holdings Pty Ltd [2007] VCAT 532 City of Brunswick (1992) EOC 92-450 (Vic) Commissioner for Equal Opportunity v ADI Ltd [2007] WASCA 261 Elizabeth Kors and AMP Society [1998] QADT 23 CASES CITED: Leslie v Barrister's Sickness & Accident Fund Pty Ltd [2003] NSWADT 216 Morris [2007] VCAT 380 Mt Isa Mines Ltd [2001] QADT 16 Olympic Road & Transport Authority [2000] QADT 10 Preshil [2005] VCAT 2140 QBE Travel Insurance v Bassanelli [2004] FCA 396 Re Auto & General Insurance Company Ltd [2009] QADT 2 Stevens v Fernwood Fitness Centres Pty Ltd (1996) EOC 92-782 (Vic) Zurich Insurance Co v Ontario (Human Rights Commission) [1992] 2 SCR 321, 93 DLR (4th) 346 APPLICANT D Williams, Minter Ellison REPRESENTATION: RESPONDENT Dr M Perry QC / Crown Solicitor ORDERS: 1. Application for exemption refused. 2. Decision under review affirmed. REASONS FOR DECISION 1 Auto and General Insurance Company Limited (A&G), and related entities, sell motor vehicle accident insurance. They belong to a worldwide group of companies, known as the Budget group, and, apart from Australia, they carry on business in the United Kingdom and South Africa. In their overseas markets they price some policies having regard to the marital status of customers. They would like to the same in New South Wales in respect of their motor accident insurance business. 2 Section 47(b) of the Anti-Discrimination Act 1977 (ADA) makes such a practice unlawful. It provides: It is unlawful for a person who provides, for payment or not, goods or services to discriminate against a person on the ground of marital or domestic status: … (b) in the terms on which he or she provides the person with those goods or services. 3 The meaning of 'services' includes services relating to insurance: ADA, s 4(1). 4 'Marital or domestic status' (ADA, s 4(1)) means the 'status or condition of being: (a) single, or (b) married, or (c) married but living separately and apart from one's spouse, or (d) divorced, or (e) widowed, or (f) in a de facto relationship. 5 Anti-discrimination laws across Australia have provisions which permit discriminatory conduct that would ordinarily be unlawful. There are two main mechanisms: specific exceptions in the body of the legislation; or, where there is no applicable specific exception, the grant of a time-limited exemption. The ADA does not provide a specific exception to insurers to discriminate on the ground of marital status. Therefore, an insurer wishing to discriminate on that basis must apply to the external decision-maker nominated by the ADA for an exemption. 6 The decision-maker until 2008 was the responsible Minister, having regard to a recommendation of the Anti-Discrimination Board. In line with a recommendation of the NSW Law Reform Commission, Report No 92 (1999), [6.144], Recommendation 50, the law was changed in that year to make the President of the Anti-Discrimination Board the decision-maker. In addition, detailed criteria to guide the decision were specified. The applicant was given a right to apply to this Tribunal for review. 7 Section 126 provides: 126 Granting of exemptions by President (1) Granting of exemptions The President may, by order published in the Gazette, grant an exemption from this Act or the regulations or such parts of this Act or the regulations as are specified in the order in respect of: (a) a person or class of persons, or (b) an activity or class of activity, or (c) any other matter or circumstance specified in the order. (2) An exemption is subject to such conditions, if any, as may be specified in the order. (3) Duration of exemptions An exemption remains in force for the period specified in the order, which cannot be more than 10 years. (4) Renewal of exemptions The President may renew any exemption, for no more than 10 years at a time, by making a new order in accordance with subsection (1). (5) Variation and revocation of exemptions The power to make an order conferred by this section includes power, exercisable in the same manner and subject to the same conditions, to vary or revoke any order so made. (6) Applications in relation to exemptions The President may grant, renew, vary or revoke an exemption only on the written application of a person. The regulations may make provision for or with respect to the making of such applications. (7) In deciding whether to grant or refuse an application, the President may consult with such persons or bodies as the President considers appropriate in the circumstances. (8) The President must make a decision on any such application within the period of 60 days after the application is made. (9) Reviews of exemption decisions by Tribunal An affected person may apply to the Tribunal for a review of any of the following decisions (exemption decisions): (a) a decision to refuse to grant an exemption, (b) a decision to refuse to renew an exemption, (c) a decision to grant an exemption (whether or not subject to conditions), (d) a decision to vary or revoke an order granting an exemption. (10) For the purposes of subsection (9), a person is an affected person in relation to an exemption decision if: (a) the person applied for the decision or for the grant or renewal of the exemption to which the decision relates, or (b) the person is otherwise directly affected by the decision. (11) Section 53 (Internal reviews) of the Administrative Decisions Tribunal Act 1997 does not apply to any exemption decision. 8 The Anti-Discrimination Regulation 2009, cl 5, re-enacting the regulation first made in 2004, provides: 5 Matters to be considered in relation to exemption orders (1) The President, when exercising a function under section 126 of the Act in relation to a proposed exemption under that section, is to consider the following matters: (a) whether the proposed exemption is appropriate or reasonable, (b) whether the proposed exemption is necessary, (c) whether there are any non-discriminatory ways of achieving the objects or purposes for which the proposed exemption is sought, (d) whether the proponent of the proposed exemption has taken reasonable steps, or is able to take any reasonable steps, to avoid or reduce the adverse effect of a particular act or action before seeking the exemption, (e) the public, business, social or other community impact of the granting of the proposed exemption, (f) any conditions or limitations to be contained in the proposed exemption. (2) In this clause, a reference to a proposed exemption includes a reference to a proposed renewal, variation or revocation of an exemption. (3) Nothing in this clause limits the power of the President to consider any other matters when exercising functions under section 126 of the Act. Review Application 9 In September 2009, the applicants applied under s 126(1) to the President of the Anti-Discrimination Board for an exemption. By decision made 5 November 2009 the President refused the application. They have now applied to the Tribunal for review of the decision. The President is the respondent to the review application. 10 The Equal Opportunity Division of the Tribunal is constituted for this purpose by a single judicial member. See Administrative Decisions Tribunal Act 1997 (ADT Act), s 22(1) (varied when sitting in the original jurisdiction by Sch 2, Part 2, cl 3). Terms of Proposed Exemption 11 The exemption sought is as follows: An exemption pursuant to s 126 of the Anti-Discrimination Act 1977 in respect of sections 47(b), 51, 52 and 53 in relation to the ground described in Part 4 of the Act, marital or domestic status. 12 The terms of s 47(b) have already been set out (at [2] above). The applicants do not seek exemption from s 47(a) which makes unlawful 'refusing' to provide those goods or services. They will provide insurance but on different terms. 13 The other three provisions to which the proposed exemption are ancillary. Section 51 prohibits the act of publishing an advertisement that indicates an intention to do an unlawful act. Section 52 prohibits aiding and abetting of an unlawful act. Section 53 deals with the liability of principals or employers. 14 The applicant proposed that the terms of the exemption be expressed to have the following effect and be subject to the following conditions: (a) that it is not unlawful for the applicants to discriminate on the basis of marital or domestic status in relation to the terms on which insurance is provided if the discrimination: (i) is based on reasonable actuarial data from a source on which it is reasonable for the applicants to rely; and (ii) it is reasonable having regard to the data and any other relevant factors. (b) the applicants will not decline a claim made under an insured's motor vehicle insurance policy on the basis that the insured failed to disclose the marital or domestic status of a regular driver or any change in marital or domestic status; and (c) the applicants will not refuse any application for insurance or insurance renewal on the grounds of the information a person provides about marital or domestic status. President's Reasons for Decision 15 It is helpful to set out the President's reasons in full, as a number of specific aspects have been challenged by the applicants in their case before the Tribunal: The Application I refer to your application for exemption on behalf of the Applicants received by the Board on 9 September 2009 requesting an exemption for a period of ten years from sections 47(b) (discrimination against persons in the provision of goods and services on the grounds of marital or domestic status), 51 (advertisements), 52 (aiding and abetting) and 53 (liability of principals and employers) of the Anti-Discrimination Act NSW 1977 (the "ADA"). I understand from your correspondence that the Applicants are in the insurance business and seek the exemption to allow them to price their motor vehicle policies differently based on a customers' marital or domestic status where it is based upon reasonable actuarial or statistical data from a source upon which it is reasonable to rely and is reasonable having regard to the data and any other relevant factors. Under the ADA there is no statutory exception to the provisions of marital or domestic status discrimination in the provision of goods and services in respect of insurance. Therefore on its face, without an exemption, the Applicant's proposal, which would permit differential pricing policies according to marital or domestic status, would constitute discrimination on the ground of marital or domestic status. You have suggested two conditions which would ensure that the Applicants will not decline a claim made under an insured's motor policy on the basis of a failure to disclose marital or domestic status or any change in that status, and that the Applicants will not refuse any application for insurance or renewal on the grounds of the information provided about marital or domestic status. You also advise that the Applicants were recently granted an exemption in similar terms under the Queensland Anti-Discrimination Act. My Decision Having regard to the ADA and the Anti-Discrimination Regulation 2009 I have decided to refuse the exemption under s126 of the Anti-Discrimination Act 1977 NSW. The reasons for my decision are that: 1. The proposed exemption is not appropriate or reasonable. The Applicants' proposal for a differential pricing scheme is contrary to the objects and purpose of the ADA. It does not redress past or present discrimination. Irrespective of whether the intention is to provide discounts to certain groups, e.g. to married or co-habiting couples, this would result in less favourable treatment according to marital or domestic status for those who paid higher premiums or did not obtain the benefit of the discounted or reduced premiums. As such the proposal is in conflict with the ADA. The Applicants argue that the proposed exemption is "not dissimilar" to existing statutory exceptions for insurance in the provision of goods and service in respect of age and sex discrimination. In addition there is an exception for insurance on the ground of disability. The ADA does not expressly allow for an exception under the marital or domestic status provisions. Since the inception of the ADA in 1977 Parliament has amended the ADA without legislating an exception for insurance in respect of the marital or domestic status ground. In addition there are specific exceptions in respect of superannuation for the provision of goods and services where discrimination might arise on the grounds of sex, age, disability, and also marital and domestic status. Parliament clearly has not intended that there should be a specific exception for insurance on the ground of marital or domestic status. 2. The proposed exemption is necessary only on the basis that the course of action proposed by the Applicants would be contrary to the ADA and is not otherwise clearly necessary. It is apparent that the proposed scheme is contrary to the ADA. On this basis it could be argued that the exemption is necessary. However, in deciding whether an exemption is necessary consideration is to be given to the framework of the ADA and to whether a scheme advances the objects of the ADA. The proposed exemption is not necessary to promote the objects of the ADA. 3. Whether there are any non-discriminatory ways of achieving the objects or purpose for which the proposed exemption is sought. The Applicants argue that they cannot avoid discriminating if they are to price their policies in a competitive way and consistent with how other international associates and insurers price motor vehicle policies. The Applicants do not appear to have put forward any non-discriminatory ways of achieving their objects. 4. Has the proponent of the proposed exemption taken reasonable steps or is able to take reasonable steps to avoid or reduce the adverse effect of a particular act or action before seeking the exemption? The adverse affect of the proposed exemption is that it is detrimental to individuals who do not get the discount or who pay higher premiums on the basis of their married or domestic status. Paragraph 14 of the Applicant's submissions states that it has been unable to take any such steps and remains unable to do so. 5. The public, business, social or other community impact of the granting of the exemption. Notwithstanding that the Applicants maintain (Para 15.2 submissions) that offering discounts to customers would have a "positive business impact" and "positive social and community impact to customers who perform more profitably", detrimental effects on certain customers because of their marital or domestic status are readily apparent. The Applicants' arguments in support of the proposed exemption are likely to be outweighed by the public, social and community impacts of the proposal. To the extent that there is a positive impact for the Applicants it is highly likely that other insurers would seek similar exemptions. This would impact upon the insurance industry, should other insurers also apply if the exemption were granted. As noted above, whilst the ADA contains specific exceptions in relation to the provision of insurance on the grounds of age, sex and disability no such specific example exists for marital and domestic status. There is a policy issue as to whether piecemeal extension of an exemption to insurers ought to be introduced by applications under s126 of the ADA or by legislation. I am of the view that the proposed differential pricing policy, which discriminates according to marital or domestic status, ought not to be introduced through the operation of s126 of the ADA. I note the Applicants have had an exemption granted by the Queensland Anti-Discrimination Tribunal. I am under no obligation to follow this decision. In considering the social and community impact of the proposed exemption, the granting of such an exemption would endorse discriminatory conduct, contrary to the objects of the ADA. The proposed conditions put forward by the Applicants in the proposed exemption do not cause me to alter my opinion. Role of Tribunal 16 The Tribunal's role is a broad one, not limited to the material that was before the decision-maker whose decision is under review; nor is it limited to the function of merely reviewing the decision-maker's decision for legal error. Section 63(1) of the ADT Act provides: (1) In determining an application for a review of a reviewable decision, the Tribunal is to decide what the correct and preferable decision is having regard to the material then before it, including the following: (a) any relevant factual material, (b) any applicable written or unwritten law. Parties 17 The President explains in his submissions that he appears as a contradictor in the absence of any other contradictor such as the Attorney General, but not as a 'determined adversary'. 18 I see no difficulty in that stance. It is usual in merits review proceedings in the Tribunal for the primary decision-maker to be the respondent in proceedings, even though one possibility is that there may be a remittal for reconsideration to the decision-maker. 19 Merits review proceedings are best viewed, I think, as in the nature of an inquiry where the object is to reach the correct and preferable decision in all the circumstances. (The titling of federal tribunal cases reflects that idea by using the language of 'In the Matter of [the applicant] and [the decision-maker]', rather than the 'versus' language this Tribunal uses, driven by external web-site publication protocols.) Applicants' Grounds 20 The applicants make the following objections to the President's reasoning: (a) there is no evidence to support the President's conclusion that Parliament has not intended that there be a specific exception for insurance on the grounds of marital or domestic status; (b) in fact there are substantial arguments to show that the proposed exemption is consistent with the scheme of exceptions already permitted by the Act and that the proposed exemption is reasonable and appropriate; (c) the President has overstated the detrimental effect that the proposed exemption would have on some people. In particular, he has not taken into account the wide availability of alternative motor vehicle insurance products and the limited nature of the exemption sought; (d) the President has not put proper weight on the positive impacts that granting the Exemption Application would have, including NSW residents being able to access an insurance product that can be offered in other jurisdictions, the ability of the Applicants to offer some customers cheaper motor vehicle policies and the removal of historical discrimination against certain groups; (e) the President failed to properly understand the purpose of the section 126 temporary exemption mechanism when he took into account the fact that other insurance companies may apply for similar exemptions; (f) although the Applicants agree that the objects of the Act are a relevant consideration when considering whether to grant an exemption, the President has placed too much emphasis on the objects of the Act to the unfair detriment of other factors listed for consideration in the Anti-Discrimination Regulation 2009 (NSW). Material before Tribunal at Hearing 21 The hearing was held on 7 June 2010. The Tribunal had before it the application for review, 2 December 2009, accompanied by the original application to the President, ADB: 7 September 2009, material in support of that application, the text of the decision of Anti-Discrimination Tribunal, Queensland (Philp SC, Member), Re Auto & General Insurance Company Ltd [2009] QADT 2 (27 January 2009) (Re A&G), and the President's reasons for refusal. 22 The parties filed the following evidence, mainly going to the applicants' case based on actuarial data. By applicants: Ray Edwards, Manager, Associate Director, Underwriting A&G, 19 August 2009; Tim Andrews, Actuary, Finity Consulting, 3 September 2009. By President, ADB: Jacqueline Lyne, Legal Officer, ADB, 19 April 2010, annexing social trends and similar official data. Peter McCarthy, Fellow, Institute of Actuaries, Partner, Ernst & Young, 19 April 2010 and 27 April 2010. Extract, Australian Bureau of Statistics, Motor Vehicle Census. By applicants in reply: Further Affidavit of Ray Edwards, 6 May 2010, attaching official data in reply such as APRA Prudential Practice Standard, other social trends data seen as relevant and the Human Rights and Equal Opportunity Commission report (1990) on Insurance and Sex Discrimination. Further Affidavit of Tim Andrews, 6 May 2010. Table: showing premium income and claims payment data by marital status type for 5 year period 2003-2008. 23 There was an exchange of written submissions, as follows: Applicant's original submissions filed 2 December 2009; supplementary submissions, 7 May 2010. President's written submissions: filed 25 May 2010. Applicants' submissions in reply, 1 June 2010. Further to leave granted at the hearing, there were further submissions from the President, 10 June 2010, and in reply from the applicants, 18 June 2010. 24 Both parties handed up various case-law authorities. The two actuaries, Mr Andrews and Mr McCarthy, gave evidence and were cross-examined. Confidentiality Order 25 The Tribunal made the following consent order pursuant to the ADT Act, s 75(2): 1. Access to and use of the Applicants' commercially sensitive information (as defined in Schedule A) for the purposes of these proceedings be restricted to: (a) The Tribunal; and (b) the parties (including the Anti-Discrimination Board, its legal representatives and employees), the parties' legal representatives and any witnesses or fellow staff members of those witnesses who have signed an appropriate undertaking agreeing to preserve the confidentiality of the commercially sensitive information. 2. For the purposes of clarification, clause 1 is not intended to restrict access to the reasons for decision of the Tribunal notwithstanding that it may disclose commercially sensitive information. Background 26 The company Budget Insurance Co Ltd of the UK received an Australian general insurance business licence in 2005. Its business was transferred to A&G in 2008. According to Mr Edwards, the Budget companies in the UK and South Africa take account of marital/relationship status as a rating factor contributing to calculation of car insurance premiums. 27 A&G has collected data relating to marital status from applicants for insurance since about 2000. The data underlying the exemption application belongs to the five year period, 2003 to 2008. He says that the data shows a 'significant statistical difference in the claims experience of our insured drivers, depending on their relationship status'. Applicants have been required to fill in a box on the application form which gives the following options as to relationship status: separated; divorced; married; cohabiting/partnered; single; or widowed. 28 The applicants presented aggregate data showing customer numbers divided by reference to gender and age bands, with the claims ratio per category; and also aggregate data divided by reference to relationship status, using the categories mentioned. The overall claims ratio for both female and male drivers who describe themselves as 'separated' is significantly higher than the overall average. This remains true, according to Mr Andrews' report, when cross-matched with age bands. 29 Mr Edwards concluded also that 'cohabitating males and females perform significantly more profitably than the average'. Mr Andrews concluded: 'The Married and Cohabiting categories appear to have subsidised the remaining groups – i.e. the loss ratios were lower such that the profitability of these segments was better than the profitability of the other categories'. 30 Interestingly, the data shows that persons who have described themselves as 'cohabiting' were the lowest risk of all, out-rating marginally, 'married' people. Mr Edwards' view was that a reduction of premiums could reasonably be given to 'cohabiting' and 'married' persons, in the order of 7% in the former instance and 2% in the latter instance. There would be off-setting increases to the premiums of the 'separated' group. 31 There were less marked differences in claims experience in the case of 'widowed' and 'divorced'. I understood A&G's position, currently, to be that it was less likely that differential pricing would be applied to the latter categories, though the terms of the exemption necessarily would leave that possibility open. Mr Andrews referred in his report, at the point where he was dealing with the claims experience of drivers aged 40+ to 'Separated, Divorced and Widowed categories to be, on average, at least 10% worse than Married, Cohabitating and Single'. 32 'Separated' persons made up a very small proportion of the claims population. In Mr Andrews' tables they constituted a mere 2.7% of all risks, and in the sub-group of drivers 40+ in age a mere 3.2% of all risks. 'Married' was the dominant cohort with 'cohabiting' lying third after 'single'. The overall proportions were: married 62%, cohabiting 11%; shifting to 68% and 8% of the 40+ group. It will be apparent that significant increases in premiums would need to be levied on the non-married and non-cohabiting segments of the insured population in order for a relatively small reduction to be made in favour of the married/cohabiting groups which together comprise 73% of policy holders. If the cost of any discounts for the married/cohabiting groups was levied entirely on the very small number of 'separated' persons, they would see considerable increases in their premiums. As I understand the evidence, they might well be of the order of 20%. The Discretion 33 Equal opportunity laws seek to reverse a history of people being excluded from areas of public life because of race, ethnicity, gender, disability, sexuality and some other attributes. Speaking broadly, the exceptions and exemptions provisions are designed to allow for circumstances where exclusion or preference based on a protected attribute may be regarded as reasonably necessary and in the public interest. The criteria listed in cl 5 assist in making that judgement. 34 It is of the nature of insurance that it seeks to match the risk to the price, allowing a margin for the risk-taker, the insurer. Historically, insurers have priced risk by reference to characteristics personal to insureds as a class. That is acknowledged by the statutory exceptions mentioned. In that way people with the 'good risk' characteristics may pay a lower price for cover than those with the 'bad risk' characteristics. 35 The applicants have been successful in procuring an exemption from the external tribunal in Queensland when none was given by way of an exception. There is no equivalent to cl 5 in the Queensland scheme. Therefore the applicants are now able to price policies in the way desired in Queensland, and see the Queensland decision, and their expert advice, as supporting the formation of the opinion that would allow them to market their policies in the jurisdictions with the standard exception. The largest regional market, the NSW market, remains. 36 Ideally, the Australian insurance market should not be inconsistent in the kinds of policies that may be offered. Insurers run national businesses and have national marketing programs. Consumers may see it as confusing and unreasonable that a product available in one State can not be accessed in another. These considerations tend to favour the case put by the applicants. 37 The parties referred to many of the exemption cases that have come before external tribunals. The longest history is in Victoria, and more recently there are cases in Queensland and Western Australia. 38 In Victoria see: City of Brunswick (1992) EOC 92-450 (restricted public swimming pool times for women; refused); Stevens v Fernwood Fitness Centres Pty Ltd (1996) EOC 92-782 (women only fitness centres and programs); Preshil [2005] VCAT 2140 (preferential enrolment of girls in co-educational school); Australian Grand Prix Corporation [2006] VCAT 2193 (discounted tickets for women to entertainment area); Morris [2007] VCAT 380 (women only tours); Boeing Australia Holdings Pty Ltd [2007] VCAT 532 (restrictions on workers' nationality imposed by United States government as a condition of access to US technical data required in the making of Australian defence aircraft). 39 In Queensland see: Olympic Road & Transport Authority [2000] QADT 10 (immunity of bus provider from anti-discrimination complaints for period of Olympic Games); Mt Isa Mines Ltd [2001] QADT 16 (special benefits to encourage retirement by workers over 55 years); Boeing Australia Holdings Pty Ltd [2003] QADT 21 (similar to the Victorian case of the same name); Beach House Group Pty Ltd [2006] QADT 30 (women only areas in health and fitness centres); Re A & G (previously cited). 40 Of these, the applicants understandably emphasised the Queensland Tribunal's decision, Re A&G, granting their parallel application there; and reversing the Queensland Commissioner's refusal. 41 In Western Australia see: Commissioner for Equal Opportunity v ADI Ltd [2007] WASCA 261 (similar to the Boeing cases previously cited); and the underlying decision, ADI Ltd and Equal Opportunity Commission [2005] WASAT 49. 42 The Tribunal's attention was also drawn to international case-law, mainly the decision under the Canadian human rights charter by the Canadian Supreme Court in the Zurich insurance case: Zurich Insurance Co v Ontario (Human Rights Commission) [1992] 2 SCR 321, 93 DLR (4th) 346. The Supreme Court permitted the insurer to charge higher premiums for motor vehicle accident insurance to male drivers under 25. The majority of the Court accepted the social utility of differential pricing in this area, taking account of the claims experience of insurers and the road safety objectives that might be served by such an approach. 43 The Tribunal was also provided with a list of the 86 exemptions granted under NSW law. They are dominated by special exemptions to support recruitment of indigenous people and women into employment. They include defence manufacturing exemptions of the kind dealt with in the interstate Tribunal decisions. 44 In my view the following two general themes may be discerned from that case-law and the NSW list. 45 One, many of the exemptions have plainly been addressed to relatively narrow-cast situations. In the area of employment, often they have involved grant of permission to the employer to advertise and fill a small number of positions restricted to a particular class of persons, say women, indigenous people, people with disabilities – in order to overcome historic under-representation of those categories or having regard to the special needs of the clientele of the employer. Some of the exemptions belong to the sphere of education. In one case an exemption was granted to enable disproportionate enrolment of girls to a co-educational school, because the school had become lop-sided to boys in its gender balance, with the result that a core objective of a co-educational school was not being served (Preshil). 46 Two, the early decisions, especially in Victoria, gave emphasis to the need for the application to have an effect which was consistent with the goal or purpose of the legislation – the elimination of discrimination based on the protected attributes. More recently there has been a movement away from that emphasis. This has occurred in the defence products cases, where the local maker could only keep the job if the US demands in relation to access to US data were met. Morris J, then President of VCAT, ruled in the Boeing case that there may be countervailing public interest considerations that justify the discriminatory conduct the subject of the application even though it clearly does not advance in any way the goal of elimination of unlawful discrimination. To that extent, he qualified the position adopted in the earlier Victorian cases. Martin CJ (Wheeler, Pullin JJA agreeing) of the Western Australian Court of Appeal endorsed this view in the ADI case. I accept the applicants' submission that an exemption application need not necessarily promote the objectives of the legislation. 47 There are relatively few exemption decisions involving commercial enterprises dealing in goods and services. The main ones have involved the sale of services restricted to women: exclusive fitness centres, exclusive swimming pool access and exclusive travel tours. No example was given of an exemption being granted to the insurance industry, other than the Queensland instance. I take it that the insurance industry is not inclined, even if its data showed some evidence that might justify it, of setting prices according to attributes that have never appeared in any of the exceptions list, such as religion, race and sexual orientation. 48 New South Wales allows only three types of otherwise unlawful discrimination based on the actuarial standard recited in the present application (see re sex, ADA s 37; disability, s 49Q; age, s 49ZYT). There is a wider array of exceptions in relation to superannuation and they include, as the applicants have emphasised, marital and domestic status (the list is sex, s 36; transgender, s 38Q; marital or domestic status, s 49; disability, s 49Q; age, s 49ZYS). 49 A person can challenge a practice adopted in exercise of a statutory exception on the ground that the relevant criteria were not met. In this Tribunal, for example, a barrister challenged his exclusion, on reaching the age of 70, from continued death and disability insurance coverage; and was unsuccessful: Leslie v Barrister's Sickness & Accident Fund Pty Ltd [2003] NSWADT 216. See also, Elizabeth Kors and AMP Society [1998] QADT 23; QBE Travel Insurance v Bassanelli [2004] FCA 396. 50 The applicants have asserted in these proceedings that the omission of marital and domestic status from the insurance exceptions list is a strange omission, especially as there is no similar omission in many of the interstate laws. See Equal Opportunity Act 1995 (Vic), s 43; Anti-Discrimination Act 1998 (Tas), s 30; Equal Opportunity Act 1984 (WA), s 34; Discrimination Act 1991 (ACT), s 28. 51 In my view, the reply submissions of the President are correct. The Tribunal must proceed on the basis that the omission is intended. The applicants have not drawn attention to any extrinsic material that might suggest otherwise. Moreover, it is apparent that the ADA has undergone regular renovation by the Parliament, and it has been the focus throughout its history of significant community debate. This all suggests it is unlikely that the omission is an accidental one. 52 As this case developed at hearing, it was essentially a contest over actuarial assumptions. The case put by the applicants has a number of difficulties. I will mention two at this point, and return to the subject at the end of these reasons. 53 First, if applicants for insurance learn that it is in their interests to describe themselves as 'married' or 'cohabiting', there is nothing to prevent them doing that. In the material presented, the most costly group was made up of people who described themselves in their initial application as 'separated'. People who describe themselves as 'separated' are most at risk of being required to pay a higher premium than other applicants if this exemption is granted. It seems to me that 'separated' persons, familiar with the consequences, might happily describe themselves as not separated but by reference to the former relationship that is implied by their self-description as separated. 54 Secondly, of the categories used in the applicants' data, some are readily verifiable by reference to public certificates (marriage certificate, divorce decree, and death certificate of spouse in the case of a widow). The others depend on a social evaluation (cohabiting, single, separated). If an insurer were to enquire behind the non-certificated descriptions, it might produce an unedifying examination of the private living circumstances of the insurance applicant. 55 It is, no doubt, for that reason that the applicants in this case will accept conditions, or give undertakings that a claim will not be declined for failure to disclose accurately relationship status, or an application or renewal will not be refused because the applicant did not give accurate information about their marital or domestic status. This concession gives rise in my view to a further problem. 56 The concessions offered by the applicants are not, in my view, supportive of the proper operation of the insurance market. If a person's marital or domestic status is a consideration that is material to the insurer, then the insured should face the consequences that insurance law has, traditionally, attached to non-disclosure of a material matter. (I note in that regard that the standard form of on-line application attached to Mr Edwards' affidavit included a warning to the applicant that their 'duty of disclosure' required them to fill out the whole form accurately. It was under this command that relationship status data was collected. On its face, it was being collected for an internal research purpose that was not made known. On the evidence in this case, it was not necessary or material to the price that would be charged.) 57 An exemption should not, it seems to me, be so formulated that it erodes the ordinary law that applies in the field of the exemption. As mentioned, many of the exemptions that have been granted go to the area of employment. An exemption that allows for the exclusive appointment of (say) young women to a position should not it seems to me go any further than that. It should not, for example, allow for erosion of the ordinary principles of employment law as they would apply to the relationship, without there being a significant justification. In my view, an equal opportunity exemption should intrude as minimally as possible in to the ordinary law that applies between the parties. 58 As I see it, it would not be fair to people who fit within the reduced price category to have their advantage compromised by failure to penalise those who take advantage of the reduced price by wrongly classifying themselves. 59 These difficulties in the implementation of the practice lead me to conclude that the proposed exemption is not appropriate or reasonable (factor (a) in cl 5). 60 Many of the successful exemption cases have at their crux the achievement of broad goals of social inclusion and social equity; or, as in the recent US technical data access cases, the preservation of important national interests (defence) and significant local manufacturing and employment. This case does not have the same order of community significance. 61 There is, I accept, a public interest in the free operation of private markets, and the promotion of innovative competition. Nonetheless in my view these do not make it 'necessary' to have introduced into the market a product of the present type with the conditions proposed. In my view the proposed exemption is not 'necessary' in any compelling sense (factor (b)). It involves a variation to premiums in a standard insurance product of a relatively marginal kind. 62 As to its public, business, social and other community impacts, I see them as on balance negative. In particular, the conditions or limitations proposed to be placed on the exemption (factor (f)), would in my opinion militate against the fair operation of insurance markets, for the reasons given. 63 Another factor listed in cl 5 is whether it is possible to achieve the objects or purposes for which the proposed exemption is sought (factor (c)). An early Victorian case gave weight to this consideration. The local council applied to confine the use of a public swimming pool to women during certain hours. The council had been motivated, in part, by concerns over poor and threatening behaviour by men. The Tribunal refused the application because it was not satisfied that any attempts had been taken by the swimming pool operator to deal with the behaviour. 64 I acknowledge the applicants' submission that it is difficult to see, given the kind of application that they make in this case, what can be said by them in relation to factor (c). It is of the nature of the application that it precludes some other approach short of denying outright to separated persons any cover (which is not sought). The whole point of the application is to give a preference to low-claimers, as identified by the insurer's data. Similarly, the only way the applicant could meaningfully 'avoid' or 'reduce' the adverse effect of their proposal is to abandon its core element (factor (d)). 65 On the other hand, in my view it is clear that the proposal has an adverse effect. It promotes a sense of unequal treatment as between people according to their relationship status. While it is the case that discrimination of this kind is still allowed in the superannuation market, NSW law is more guarded in relation to the general insurance market. In my view, the more relaxed approach to the superannuation market is, perhaps, to be explained by historical practices in superannuation and the social significance of superannuation in relation to income in old age. 66 'Separated' people is a group that is likely to include women with the primary or sole care responsibility for children of their former relationship. (This may well also be true of two other categories seen as poorer risks – 'divorced' and 'single'.) The present proposal would have the result of imposing higher premiums on these people. A practice of this kind will tend to increase the sense of social isolation and stigmatisation of sole parents, many of whom are women. Much of the material in the affidavit filed by Ms Lyne of the Board went to this matter. 67 I return to the issue that the applicant feels should receive the closest consideration, i.e. whether the practice the applicants propose is 'based on reasonable actuarial data from a source on which it is reasonable for the applicants to rely'. 68 Whether the data was 'reasonable actuarial data' was strongly contested in this case. The difficulty I have is that I am called on to address that question only having heard from two actuaries. One of them, Mr Andrews, is the appointed actuary of the applicants, and is, therefore, closely familiar with its business environment and business model. The other, Mr McCarthy, is an experienced actuary who has held senior positions with major insurers and is familiar with this field of insurance. 69 From what I have learnt about industry practice from these two witnesses, I am inclined to think that some insurers, at least, would probably treat data of the kind presented in this case as 'reasonable' at least for the purpose of pilot testing the market, if not for a full roll-out of new premiums and incentives. 70 On the other hand, the President of the Board pressed the Tribunal to make an independent, more objective judgement of whether it was 'reasonable' actuarial data. I am disinclined to embark on a close inquiry into that question. However there are a number of aspects of the evidence that incline me to the view that the case presented by the applicants on this matter is weak. I have alluded to some of them earlier in these reasons. 71 In my view a number of Mr McCarthy's criticisms of Mr Andrews' evidence were sound. They include the following: (i) The applicants merely rely on the description of status given by the applicant in the forms collected over the last 10 years. The applicants gave no evidence as to any practice of verifying or testing the reliability of the data. (ii) Marital status can change quickly and there is no evidence as to how that is brought into consideration. (So, for example, a 'separated' person may return to the old relationship or enter a new relationship of cohabitation without that being recorded.) (iii) No clarity as to how the insurer defines the statuses it uses in its proposal forms. Mr McCarthy referred to having made searches on its information sites, but no guidance was provided. (iv) The reservations evident in the opinion of Mr Andrews. They include Mr Andrews' noting that there has been no representative sampling of individual claims' experiences to see if they corroborate the generic data relied upon by the applicants; and the omission of any analysis of whether other differentials or variables contribute to or skew the higher risk said to be evident in particular groupings (as for example, the possibility that single drivers tend to live in higher risk geographic zones), and what might result if that factor is removed. (v) As to the last point, Mr Andrews did consider in his analysis the interaction of marital status with age of driver. Mr McCarthy noted that after the age factor was applied the loss ratios reduced to 67% (previously 71%) in the case of 'separated' drivers, and to 54% from 56% in the case of 'single' drivers. This reduced in Mr McCarthy's opinion all categories but 'separated' to marginal in terms of their deviation from the experience of married/cohabiting claimants. He notes that this is a very small cohort in the overall group of insured persons. 72 It will be seen that my reasons do not turn only on the actuarial data. 73 In my view, given the way the NSW legislation is framed, it would be wrong to decide the case simply on the basis of actuarial data. It is for this reason that I do not regard the Queensland case as a precedent of any great importance. 74 In my view this is a weak to marginal actuarial data case. 75 That factor, mixed with the other considerations to which I have referred, leads me to conclude that the application should not be granted, and the decision under review affirmed. Order 1. Application for exemption refused. 2. Decision under review affirmed. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.