A City law firm has warned employers who provide health insurance as a benefit to their staff, could face claims of age discrimination if they fail to get insurance cover for older workers.

However, Reynolds Porter Chamberlain said in some cases, it may prove impossible to find health insurance for those aged 65 or over.

RPC said it could prove very expensive for employers to provide private medical insurance to cover treatment costs or health insurance policies, which provide a source of income for employees that are unable to work due to sickness.

Geraldine Elliott, head of the Employment Group at RPC, said: “There is a big gap in the permanent health insurance market which makes it very difficult for employers who offer this benefit to satisfy their obligations to treat workers of all ages equally.

“With the uncertainty as to when older workers will retire and the claims risk they are likely to generate, insurers are often unwilling to extend cover to them.

“Although treating staff differently on the basis of their age can be justified under the age discrimination legislation, employers can only do so to pursue a legitimate aim and if the means it is using are proportionate.”

She added that firms may not be able to justify failure to provide permanent health or private medical cover to employees over 65 because it is too expensive.