Mortality among the general and insured populations has witnessed remarkable improvement over the last several decades. Individuals today can expect to be healthier and to live longer than ever before.
Based on these developments, there is a tendency to think that mortality improvement will continue indefinitely, that it will improve at an even faster pace in the future, and that it will be great for all people, especially for the insured.
But future mortality trends will not mirror past trends, and compared to past mortality, future mortality could improve at a slower pace and could even worsen, even among the insured. As a result, better understanding of future mortality trends will spell success in: offering the right products, future product development, and underwriting.
Although general population mortality has improved over time, part of that may be overstated. Substantial mortality improvements often come after periods of mortality deterioration. For example, between 1970 and 1975, males aged 30-35 saw annual mortality improvement of over 2%; but this was likely an adjustment to the 1.5% annual mortality worsening that occurred during the previous five-year period.
Even major periods of mortality improvement can be followed by times of deterioration. Between 1980 and 1985, males aged 25-30 witnessed a 3.3% annual improvement in mortality; but in the next five years, males experienced 2.1% mortality deterioration.
Mortality operates within a complex framework and is influenced by socioeconomic factors, biological variables, government policies, environmental influences, health conditions and health behaviors.
Not all of these factors improve with time. Indeed, recent events underscore the risks of natural and human-made disasters, including terrorist attacks. Although cigarette smoking prevalence rates have declined since the 1964 Surgeon Generals Report, large proportions of the population continue to smoke. And although educational programs espouse the benefits of exercise and proper diets, obesity has increased in the U.S.
Over the last century, mortality has declined due to improved public health efforts such as chlorinization, pasteurization, and refrigeration; medical breakthroughs, including the use of antibiotics; and improvements in the environment and in increased standards of living such as better and more affordable housing, clothing and food.
Once these improvements are implemented, their contributions to mortality improvement are realized, and few additional gains remain; for example, once milk is pasteurized, additional pasteurization does not confer additional benefits. Thus, new improvements must be devised to continue improving mortality.
Further raising already high life expectancies may become increasingly more difficult, a phenomenon called life table entropy. The accompanying figure shows that there were greater gains in survival a century ago than there have been more recently. For instance, note the relatively large survival gains achieved between 1900 and 1920, compared to the modest gains realized between 1980 and 1999.
And, there is still a chance for a resurgence of infectious diseases. Deaths due to influenza could increase with the introduction of new influenza strains or with shortages of the influenza vaccine. Although HIV is now controlled, it is not eradicated and could expand, or variants of HIV could develop that could increase mortality. Drug resistant infectious diseases like tuberculosis could increase.
The effects of medical breakthroughs are sometimes overestimated. People are heralding the potential of genetic research. Genetic research may be most successful at treating rare single gene disorders and may have little impact on more prevalent diseases that result from multiple gene disorders. Major advances in genetic therapy may be modest and in the distant future.
Compared to general population mortality, insured mortality has improved at a faster pace, largely due to underwriting. The increasing gap may be difficult to sustain into the future.
There is a large and growing arsenal of underwriting tools, including EKGs, treadmill tests, nicotine testing, liver function tests, PSA tests, motor vehicle reports, and cocaine testing.
The judicious use of these tests has led to improved underwriting and great reductions in issue age mortality. It is ironic that companies are clamoring for additional underwriting tests and screens at a time when there is increasing pressure to reduce the costs and numbers of required tests.
There are market pressures to drop EKG and treadmill tests, to use urine rather than blood tests, to use saliva rather than urine tests, or to drop laboratory tests altogether.
Requiring fewer tests and increasing the face amounts upon which the tests would be required could increase anti-selection and may increase the chance that individuals with underlying but undiagnosed conditions will not be properly underwritten.
Future mortality can improve or worsen. If the future conditions deteriorate–through increased smoking and obesity, emerging infectious diseases, economic downturns, or environmental hazards–we could experience periods of worsening mortality. Most likely, future mortality will continue to improve, but at a modest pace.
Dr. Rick Rogers is senior demographer of ING Re, based in Denver. He can be reached via e-mail at Richard.Rogers@ing-re.com.
Reproduced from National Underwriter Life & Health/Financial Services Edition, August 26, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.