Gender discrimination is fine, provided it's used to ensure people are charged a fair rate for insurance, according to (male) Observer readers.

Cash invited readers to send in their views of proposed European legislation, currently grinding its way towards a final Council of Ministers' vote in June, which could see the end of gender being used as a risk-rating factor for pricing many types of insurance.

Insurance is exempted from British sex discrimination legislation, and the UK insurance industry is lobbying hard to earn the same exemption from its European equivalent. The legislation, if implemented in its current form, is expected to push car insurance rates up considerably for young women, and reduce annuity payouts for men.

The British government says it welcomes the new legislation: 'Gender discrimination is unacceptable and it is vital to prohibit discrimination in the area of goods and services to ensure that women in Europe equally participate and advance in society. We want a fair and prosperous EU that treats everyone equally and provides equal opportunities.'

But the majority (90 per cent) of Observer readers - strangely all men - responding to an article in Cash three weeks ago disagree, evidently regarding the inclusion of insurance in the gender discrimination bill as Euro-madness on a par with demanding non-bendy bananas.

Reader John Short says: 'I am quite staggered that this piece of legislation is even being considered in the UK. To fly in the face of statistical science and its place in refining premiums for different risk groups is an extremely dangerous precedent being set by our political masters. There will be no stopping them on their way to take away the discrimination in postcode considerations in car and house insurance and then dangerous sports.

'Why should I, being of a nervous disposition, subsidise a base-jumping, free-falling sky diver. It's lunacy. Regarding annuity differentials, [the Government shouldn't] tinker with or ignore the underlying science in setting these rates, but simply continue to rely on social security provision to catch those falling below.'

Derbyshire reader Paul Swets believes that the European proposal confuses risk and a classification that happens to be gender: 'This seems misguided to me. UK insurance companies are not discriminating against young men or young women. They have observed differing behaviour, leading to differing claims patterns, between many and varied identifiable classes of people. As stated, geographical location affects the incidence of break-ins and thefts; the driver's age affects the claims for collision damage (frequency and severity) and even one's past claims history is used to assess how much has to be paid for insurance cover.

'It is coincidental that an observed boundary between different risk groups happens to be gender (at certain ages). Therefore it is not logical to legislate against it, just because of political correctness in a different sphere of life, that is sex discrimination in employment and other aspects of society. Using the same muddled thinking, when age discrimination legislation is more widely supported [here and in Europe] then car insurance will become cheaper for youngsters and more expensive for oldies. How absurd!'

Stephen Ross, a charity finance director, says that insurance is a risk transfer mechanism to compensate the unfortunate few through the good fortune of the majority. 'It should not be subverted into a tool of social engineering. There are precedents for excluding insurance from legislation and this is another case where common sense is required.'

Very few supported the idea of eliminating gender as a risk determinant, but reader Bill Breedon encap sulates the views of those who do: 'Gender was always a crude tool for measurement. Careful male drivers are paying even more for poor male drivers than women will, because the pool is cut in half by separation of the sexes. I generally support the original aim of insurance to spread the risk among as large a group as possible.

'There is a growing group of uninsured drivers, mostly male, who are priced out of the market, and constitute a risk to the rest of us. I have personally been in an accident with one of these drivers, and the consequences are time consuming, costly and disruptive. The extra cost in premiums to cover their poor records would have been well worthwhile if spread among the whole community of drivers.'

He also queries why eliminating gender from annuity calculations would have such a negative effect on men's pensions: 'If the value of men's pensions is so much higher than women's, and the proportion of men with pension funds is so much higher, why would granting women equality cost men so much? I'm not bad at sums, but I can't work that one out.'