NU Online News Service, Nov. 7, 2003, 5:59 p.m. EST – Will mortality continue to improve?
That’s a tough call, according to Tracy Choka, director of applied research and development at Swiss Re Life & Health America, Stamford, Conn., which recently held a conference that focused on the topic.
“As an industry, we have got to really watch it,” Choka argues.
The positive trends that Choka cites include improvements in cardiovascular health, the availability of more genetic information and the decline in smoking.
The 1975-80 mortality tables assume a 30% prevalence for smoking. Smoking prevalence has dropped to 8% to 10% in the 1990-95 table.
But Choka says infectious diseases and increasing obesity rates add some uncertainty to mortality forecasts. Although new drugs and education could help fight obesity, lifestyle choices could slow improvement, she adds.
Because of these mixed signals, it is important for insurers to take care when fine-tuning preferred risk underwriting categories, Choka says.
Weldon Wilson, Swiss Re Life’s chief executive, emphasizes that any underwriting improvements must be cost effective.
Wilson gives the choice between using an attending physician’s statement and using a motor vehicle report as one example of the differences in the cost of underwriting tools. Using an attending physician’s statement may cost $50, while using a motor vehicle report could cost as little as $7, Wilson says.