Recent Australian insured lives mortality: a review of the Actuaries Institute/FSC Lump Sum Investigation

Transcription

1 Recent Australian insured lives mortality: a review of the Actuaries Institute/FSC Lump Sum Investigation Bridget Browne Contents Introduction to Australian life insurance Overview of report and contents Comparison with Australian population mortality Comparison with previous insured lives mortality Life expectancy measures 2

2 Life Insurance in Australia 21 insurers, 7 reinsurers, total assets $246bn Savings vs risk products Risk events covered: death, serious illness (trauma), temporary or permanent disablement Lump sum risk premium growth appx 9%pa Net premium to 30/6/13 of $5.7bn 3 Overview of report and contents Graduation Taskforce of the Australian Actuaries Institute Original data collected by Financial Services Council and KPMG Mortality tables produced by sex, age, smoker status (incl aggregate) Death and disability only consider Death Only and Death with Rider tables here 4

3 Scope Lump Sum not income stream Individual not Group Reviewable term & riders, not Traditional Standard lives not sub-standard or rated Dimensions: sex, age, smoker status, duration of policy 5 Data and adjustment Period 31/12/03 to 31/12/08 (5 cal years) Claim status Admitted, Pending, Denied Adjustment for IBNR (claims not yet notified) and ultimate result for Pending Age definition: age last (ie attained) as last policy anniversary 6

4 Death Only by Policy Count - Exposure and Claims for Males and Females 7 Death Only by Amounts - Exposure and Claims for Males and Females 8

5 Death w Rider by Policy Count Exposure and Claims for Males & Females 9 Death w Rider by Amount Exposure and Claims for Males & Females 10

6 Key figures Table 1 - Total Exposure & Claims, Males and Females by product type and measure Male Female Total Exposure Death Only Policy Count Death Only Dollar Amount $1 003 bn $543 bn Death with Rider Policy Count Death with Rider Dollar Amount $798 bn $431 bn Total Claims Death Only Policy Count 6,277 2,631 Death Only Dollar Amount $1 367 m $391 m Death with Rider Policy Count 1, Death with Rider Dollar Amount $423 m $109 m 11 Key figures Table 2 Average Sum Insured for Males and Females, Exposure & Claims Average Sum Insured Male Female Death Only Exposure $ $ Death Only Claims $ $ Death with Rider Exposure $ $ Death with Rider Claims $ $

7 Key rates and ratios Table 3 - Female Total Exposure and Claims as a percentage of Male by product type and measure Claim rates per 1000 Male Female Female/Male (Claims/Exposure x 1000) Death Only Policy Count % Death Only Dollar Amount % Ratio 72% 64% Death with Rider Policy Count % Death with Rider Dollar Amount % Ratio 84% 83% 13 Table naming convention Codes Meaning DO or DR Death Only or Death with Rider M or F Male or Female N, S or A Non-smoker, Smoker or Aggregate Years of exposure 14

8 Non-smoker tables log scale 15 Smoker vs Non Smoker DOFS04-08/ DOFN04-08 DRFS04-08/ DRFN04-08 DOMS04-08/ DOMN04-08 DRMS04-08/ DRMN04-08 CIA97-04 Male S/N CIA97-04 Female S/N

9 Table fit to data 200% 180% 160% 140% 120% 100% 80% 60% 40% 20% 0% DOMA04-08 Count DOFA04-08 Count DOMA04-08 Amount DOFA04-08 Amount 200% 180% 160% 140% 120% 100% 80% 60% 40% 20% 0% DRMA04-08 Count DRFA04-08 Count DRMA04-08 Amount DRFA04-08 Amount 17 Table fit to data Smoker/Non-Smoker Actual/Expected Male Female Death Only Count Amount Count Amount Non Smoker 99% 90% 95% 87% Smoker 101% 102% 101% 91% Male Female Death with Rider Count Amount Count Amount Non Smoker 91% 91% 98% 96% Smoker 112% 110% 86% 103% 18

10 Comparison with Australian population mortality DOFA DOMA DRFA04-08 ALTF DRMA04-08 ALTM Comparison with Australian population mortality - ratios 20

11 Comparison with previous insured lives mortality 21 Ratio of current to past mortality rates, for insured lives and general population 22

12 Life expectancy measures Female ALTF95-97a ALTF05-07a IAF95-97a DOFA04-08 DOFN04-08 DOFS04-08 e e Male ALTM 95-97a ALTM 05-07a IAM 95-97a DOMA DOMN DOMS e e Female IAF95-97a - ALTF95-97a DOFA ALTF05-07a Male IAM95-97a - ALTM95-97a DOMA ALTM05-07a e e e e Conclusion Changes in practice Business mix changes Relaxation of u/w requirements Selective lapsation Thank you for your attention. Questions? 24

13 References AUSTRALIAN BUREAU OF STATISTICS Deaths, Australia, 2012 Table 2: Death rates 2002 to 2012 [Online]. [Accessed 16 Dec 2013]. AUSTRALIAN GOVERNMENT ACTUARY Australian Life Tables AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY (APRA) 2013a. Quarterly General Insurance Performance, June AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY (APRA) 2013b. Quarterly Life Insurance Performance, June CONTINUOUS MORTALITY INVESTIGATION MORTALITY COMMITTEE CMI Working Paper 21 The Graduation of the CMI Mortality Experience: Final 00 Series Mortality Tables Assured Lives. GRADUATION TASKFORCE Graduation of the Lump Sum Investigation Data. Actuaries Institute. IAAUST MORTALITY COMMITTEE Institute of Actuaries of Australia Mortality Investigation IA95-97 M and F: Graduated Mortality Tables. INDIVIDUAL LIFE EXPERIENCE SUBCOMMITTEE Construction of CIA9704 Mortality Tables for Canadian Individual Insurance based on data from 1997 to 2004 [Online]. Canadian Institute of Actuaries. Available: [Accessed July 2013 from Society of Actuaries Mortality Table utility SOCIETY OF ACTUARIES MORTALITY TASK FORCE Report Of The Individual Life Insurance Valuation Mortality Task Force, 2001 Valuation Basic Mortality Table. THE LIFE RISK INSURANCE COMMITTEE Report on the Lump Sum Experience Investigation UNIVERSITY OF CALIFORNIA BERKELEY (USA) AND MAX PLANCK INSTITUTE FOR DEMOGRAPHIC RESEARCH (GERMANY) Human Mortality Database. 25