Gen Re Dread Disease Survey 2004-2008 Wolfgang Droste Session Number: MBR8 Joint IACA, IAAHS and PBSS Colloquium in Hong Kong www.actuaries.org/hongkong2012/
Agenda Background of Gen Re s Dread Disease Survey The 2004-2008 Survey results Summary Market Survey and Product Features Claims Analysis Incidence Rates Analysis 2
Number of participating companies South Africa 0 (3) New Zealand 11 (new) Hong Kong 17 (16) Malaysia 11 (7) Singapore 7 (6) 95 companies in the Gen Re Dread Disease Survey 2004-2008 Thailand 5 (new) Indonesia 4(new) Australia 10 (new) UK 4 (4) China 25 (12) Korea 3 (new) Initial Results 3
Expanding Scope of the Survey Survey Countries Companies Claims Lives In-force 1 1990 1994 3 4,600 2 1993 1997 3 7,000 3 million 3 1996 2000 3 31 16,000 4 million 4 2000 2004 6 48 263,000 41 million 5 2004 2008* 10 95 750,000 > 70 million Initial Results 4
Agenda Background of Gen Re s Dread Disease Survey The 2004-2008 Survey results Summary Market Survey and Product Features Claims Analysis Incidence Rates Analysis 5
Distribution of In-Force Policies by Product Type Total China Hong Kong Malaysia Singapore Korea Australia UK Traditional 65,881,831 56,518,249 1,301,874 3,240,367 1,159,556 1,094,701 573,521 1,993,563 Juvenile 1,917,749 1,788,851 76,908 8,713 42,785 0 492 0 Cancer 650,960 625,527 1,987 23,384 62 0 0 0 Female 545,635 206,543 144,768 162,351 31,973 0 0 0 Male 3,661 0 3,362 0 299 0 0 0 Total 68,999,836 59,139,170 1,528,899 3,434,815 1,234,675 1,094,701 574,013 1,993,563 Initial Results 6
In-Force Policies by Age Band Age Group China Hong Kong Malaysia Singapore Korea Australia UK 0-19 15% 5% 19% 16% 9% 2% 0% 20-29 12% 17% 21% 16% 29% 7% 15% 30-39 28% 34% 30% 28% 30% 30% 43% 40-49 29% 30% 20% 25% 23% 40% 33% 50-59 15% 12% 9% 13% 7% 19% 9% 60+ 2% 2% 1% 2% 0% 2% 1% Total 100% 100% 100% 100% 100% 100% 100% Average Age 35.8 37.3 31.7 34.5 33.8 41.6 38.3 Average duration 3.7 5.6 6.0 8.1 2.0 5.1 4.1 7
Average Sum Insured (US$) of In-Force Policies by Age Band 160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0 China Hong Kong Malaysia Singapore Australia UK 0-19 20-29 30-39 40-49 50-59 60+ 8
Number of New Policies Written by Year as % of New Policies Written in Year 2004 China Hong Kong Malaysia Singapore Australia South Korea UK 2000-2004 Survey 5,472,627 134,925 378,489 80,912 247,064 2004-2008 Survey 6,176,885 132,608 410,568 75,993 74,309 305,971 471,213 9
Average Sum Insured (US$) for New Business 160.000 140.000 136.464 130.970 133.127 120.000 100.000 109.219 80.000 60.000 40.000 20.000 0 56.810 45.608 49.285 42.531 27.771 34.570 13.476 14.213 5.071 6.985 2004 2005 2006 2007 2008 China Hong Kong Malaysia Singapore Korea Australia UK 10
Benefit Type China Hong Kong Malaysia Singapore Australia Korea UK 0% 20% 40% 60% 80% 100% Acceleration Type Additional Type 11
Premium Reviewability In-Force Policies China Hong Kong Malaysia Singapore Australia Korea UK 0% 20% 40% 60% 80% 100% Fully Guaranteed Ltd period gtee Not guaranteed Other Unknown 12
Med Distribution of In-Force Business China Hong Kong Malaysia Singapore Australia Korea UK 0% 20% 40% 60% 80% 100% Med Non-Med Simplified Issue Unknown 13
Waiting Period China Hong Kong Malaysia Singapore Australia Korea UK 0% 20% 40% 60% 80% 100% 30 60 90 180 365 14
Survival Period for Additional DD Products China Hong Kong Malaysia Singapore Australia UK 0% 20% 40% 60% 80% 100% 0 14 21 28 30 60 90 15
Agenda Background of Gen Re s Dread Disease Survey The 2004-2008 Survey results Summary Market Survey and Product Features Claims Analysis Incidence Rates Analysis 16
Number of Claims by Market All claims collected Total China Hong Kong Malaysia Singapore Australia Korea UK New Zealand DD 452,870 377,524 11,808 21,354 9,049 7,870 5,428 16,360 3,477 Death 294,427 276,095 1,646 8,934 1,284 906 1,823 3,162 577 Total 747,297 653,619 13,454 30,288 10,333 8,776 7,251 19,522 4,054 17
Declinature Rate by Market China Hong Kong Malaysia Singapore Australia UK 0% 5% 10% 15% 20% 25% DD Survey 1996-2000 DD Survey 2000-2004 DD Survey 2004-2008 18
Declinature Rate by Duration Declinature rate for duration 0 & 1 claims as % of declinature rate for duration 2+ claims 500% 450% 400% 350% 300% 250% 200% 150% 100% 50% 0% China Hong Kong Malaysia Singapore Australia 0 1 2+ UK 19
Reasons for Declinature China (17,763) Hong Kong (425) Malaysia (16) Singapore (199) Australia (188) UK (379) 0% 20% 40% 60% 80% 100% Non-disclosure Within waiting period Definition not met Disease not covered Exclusions Other 20
Number of Days from Diagnosis to Benefit Payment for All Admitted Claims All Admitted Claims Claims Occurred in First Policy Year Diagnosis to Notification Notification to Benefit Payment Diagnosis to Benefit Payment China 76 37 109 Hong Kong 69 36 104 Malaysia 98 38 126 Singapore 84 20 102 Korea N/A N/A 43 Australia 87 91 167 New Zealand 79 48 122 UK 95 113 188 China 85 50 133 Hong Kong 79 83 158 Malaysia 104 85 182 Singapore 89 60 148 Korea N/A N/A 59 Australia 84 140 226 New Zealand 80 56 135 UK 96 124 211 21
Agenda Background of Gen Re s Dread Disease Survey The 2004-2008 Survey results Summary Market Survey and Product Features Claims Analysis Incidence Rates Analysis 22
> Include all claims for Standard lives Traditional type products Methodology Some products may cover more diseases than other, range from 5 to 49, most cover 25-35 diseases, all products cover at least cancer, heart attack and stroke >All products are treated as 100% acceleration, i.e. exposed to risk ceases when a claim occurs, either as Dread Disease Claim or as Death Claims >Only include exposure and claims after waiting period > Actual over Expected Ratios (A/E) Number of expected claims are calculated using the graduated incidence rates from the DD survey 2000-2004 23
Cancer Incidence Rates per 1000 by Duration Males 2.50 2.00 1.50 1.00 0.50 0.00 China Hong Kong Malaysia Singapore Australia Korea UK 0 1 2+ 24
Cancer Site Distribution by Market Males 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Other sites Urinary tract Thyroid Stomach and Oesophagus Nasopharynx Male genital organs Lymphoma Lung Liver Leukaemia Colorectal 25
100% Cancer Site Distribution by Age Band Hong Kong Males 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 0-19 20-39 40-59 60+ Other sites Urinary tract Thyroid Stomach and Oesophagus Nasopharynx Male genital organs Lymphoma Lung Liver Leukaemia Colorectal 26
Cancer Incidence Rates per 1000 by Duration Females 3.50 3.00 2.50 2.00 1.50 1.00 0.50 0.00 China Hong Kong Malaysia Singapore Australia Korea 0 1 2+ UK 27
Cancer Site Distribution by Market Females 100% 90% Other sites 80% Liver 70% Urinary tract 60% Leukaemia 50% Lymphoma 40% Stomach and Oesophagus 30% Nasopharynx 20% Lung 10% Thyroid 0% Colorectal Female genital organs Breast 28
Cancer Site Distribution by Age Band Hong Kong Females 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 0-19 20-39 40-59 60+ Other sites Urinary tract Thyroid Stomach and Oesophagus Nasopharynx Lymphoma Lung Liver Leukaemia Female genital organs Colorectal Breast 29
Population Cancer Incidence - Female Per 1000 all sites 3.00 2.50 2.00 1.50 1.00 0.50 Hong Kong Shanghai China-All China-Urban China-Rural 0.00 1980 1985 1990 1995 2000 2005 2010 30
Per 1000 Breast 0.60 Population Cancer Incidence - Female 0.50 0.40 0.30 0.20 Hong Kong Shanghai China-All China-Urban China-Rural 0.10 0.00 1980 1985 1990 1995 2000 2005 2010 31
Cancer Incidence Hong Kong Female Breast Insured lives 2004-2008 No. of Claims Cancer Incidence Population Cancer Incidence Insured lives / Population Ratio Age All dur 0 1 2+ 0 1 2+ 20-24 2 0.0362 0.0000 0.0194 0.01 312% 0% 167% 25-29 14 0.0236 0.0619 0.0517 0.06 39% 102% 85% 30-34 102 0.3279 0.1844 0.2587 0.20 166% 93% 131% 35-39 237 0.4442 0.8116 0.6017 0.48 93% 170% 126% 40-44 355 0.6992 0.7217 1.0923 0.96 73% 75% 114% 45-49 370 1.1463 1.2945 1.6002 1.38 83% 94% 116% 50-54 200 1.6083 1.0298 1.5065 1.39 116% 74% 108% 55-59 79 0.5992 1.2073 1.1543 1.44 42% 84% 80% 60-64 32 0.0000 2.5442 1.7542 1.41 0% 180% 124% 20-64 1391 0.5081 0.7128 0.7620 0.69 74% 103% 111% 32
Cancer Incidence China Female Thyroid Insured lives 2004-2008 No. of Claims Cancer Incidence Population Cancer Incidence Insured lives/population Ratio Age All dur 0 1 2+ 0 1 2+ 20-24 168 0.0445 0.0558 0.0397 0.03 132% 166% 118% 25-29 441 0.0593 0.0518 0.0684 0.06 106% 93% 122% 30-34 1011 0.0930 0.0652 0.0797 0.07 137% 96% 117% 35-39 1535 0.0869 0.0864 0.0942 0.08 106% 106% 115% 40-44 1907 0.1241 0.1001 0.1177 0.11 110% 88% 104% 45-49 1511 0.0982 0.0710 0.1334 0.13 77% 55% 104% 50-54 1229 0.0906 0.0881 0.1255 0.16 56% 55% 78% 55-59 384 0.1246 0.0942 0.0953 0.13 97% 73% 74% 60-64 113 0.0053 0.0679 0.0940 0.11 5% 64% 88% 20-64 8299 0.0813 0.0739 0.0907 0.09 90% 81% 100% 33
Thyroid cancer experience in Korea Thyroid cancer rates for females in Korea increased almost seven timesfrom 1999 to 2008 Source: National Cancer Registration & Statistics 2008, the Korea Central Cancer Registry 34
Thyroid cancer experience in Korea No indication that the increase of the thyroid cancer diagnosis rates has been stabilising Further increases should occur in particular in minor conditions of thyroid cancer Age distribution of currently insured portfolios of an obligatory Critical Illness rider is similar to the age structure of newly diagnosed thyroid cancers Companies should hence experience the impact of the deterioration of rates already at this stage In South Korea, thyroid cancer makes up a significant proportion of critical illness claims. Mortality from papillary thyroid cancer is very low, but prevalence is approximately 10% (based on post-mortem studies). People are having ultrasounds after buying a critical illness policy and then claiming. Robjohns et al, Exploring The Critical Path, A report from the Critical Illness Trends Research Group 35
Why has Korea such a bad experience? Product perspective 100% of sum insured needs to be paid for any cancer - benefit does not distinguished between minor cancers and severe cancers, company pays 100% of sum insured in both cases. Medical environment Medical technology improvement There is a good national health system in Korea Medical check up Regular medical check-up is popular Doctors intensively do diagnostic activities such as ultrasonography for thyroid cancer 36
Stroke incidence rate, by sex and duration 0,60 Stroke 0,50 0,40 0,30 0,20 Dur 0 Dur 1 Dur 2+ 0,10 0,00 CN-M HK-M CN-F HK-F Age 30-59, Age Adjusted using WHO 2000 Standard Population, Per 1000 37
Regional Differences 38
Regional Differences 4,00 Incidence Rate By Region - Cancer + Stroke + Heart Attack + Kidney Failure 3,50 3,00 2,50 2,00 M F 1,50 1,00 0,50 0,00 NorthEast North East South Central NorthWest SouthWest HongKong 39
2,50 Regional Differences Incidence Rate By Region - Cancer 2,00 1,50 1,00 M F 0,50 0,00 NorthEast North East South Central NorthWest SouthWest HongKong Dur 2+, Age 30-59, Age Adjusted using WHO 2000 Standard Population, Per 1000 40
Regional Difference Incidence Rate By Region - Breast Cancer 0,90 0,80 0,70 0,60 0,50 0,40 0,30 M F 0,20 0,10 0,00 NorthEast North East South Central NorthWest SouthWest HongKong Dur 2+, Age 30-59, Age Adjusted Gen Re Dread using Disease WHO Survey 20002004-2008 Standard Population, Per 1000 41
Regional Differences 0,30 Incidence Rate By Region - Nasopharyngeal Cancer 0,25 0,20 0,15 0,10 M F 0,05 0,00 NorthEast North East South Central NorthWest SouthWest HongKong Dur 2+, Age 30-59, Age Adjusted using WHO 2000 Standard Population, Per 1000 42
Regional Differences Incidence Rate By Region - Stroke 1,00 0,90 0,80 0,70 0,60 0,50 0,40 M F 0,30 0,20 0,10 0,00 NorthEast North East South Central NorthWest SouthWest HongKong Dur 2+, Age 30-59, Age Adjusted Gen Re Dread using Disease WHO Survey 20002004-2008 Standard Population, Per 1000 43
Agenda Background of Gen Re s Dread Disease Survey The 2004-2008 Survey results Summary Market Survey and Product Features Claims Analysis Incidence Rates Analysis
Summary Dread Disease products continue to sell well Sold mainly to 30-40 and children High ex-gratia % in China High declinature rates in Australia High declinature rates in Australia Stable incidence rates in HKMS Increasing incidence rates in China Cancer incidence rates increasing Significant difference among companies and among regions
Thank you! Joint IACA, IAAHS and PBSS Colloquium in Hong Kong www.actuaries.org/hongkong2012/