Dread Disease Insurance towards local experience

Transcription

1 Dread Disease Insurance towards local experience Wolfgang Droste IAAHS - Colloquium April 2004 A Berkshire Hathaway Company

2 A Berkshire Hathaway Company?

3 Contents 1. Gen Re s Survey 2. International Comparisons 3. Trends in Cancer Incidence 4. For Your Consideration 3

4 Contents 1. Gen Re s Survey 2. International Comparisons 3. Trends in Cancer Incidence 4. For Your Consideration 4

5 Gen Re s Survey Background information Claims analysis Admitted claims Cancer claims Declinature Incidence rates 5

6 Market Coverage Hong Kong (15), Malaysia (9) and Singapore (7) 4.0 million lives in force on Singapore 33% Hong Kong 22% Malaysia 45% Market Survey and Product Features 6

7 In-force by sex Number of in-force policies issued to women > number of in-force policies issued to men (for age 20 40) 90,000 Number of In-force Policies 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 Male Female Age Market Survey and Product Features 7

8 Average Sum Insured Average claim amount < Average sum insured As at 31/12/2000: $US Claims In-force Difference Hong Kong: 34,922 39, % Malaysia: 9,102 9, % Singapore: 20,672 23, % Market Survey and Product Features 8

9 Sales Volume No. of new policies stable Around 650,000 policies each year New business sum insured increasing US$12.5 billion (1996), US$14.5 billion (2000) Proportion of age 0-19 policies (in-force) increasing 3% (1993), 17% (1998), 15% (2000) Market Survey and Product Features 9

10 Claims Analysis Background information Claims analysis Admitted claims Declinature Cancer claims Incidence rates 10

11 Survey Basis 16,507 claims in total 13,832 Dread Disease claims (of which 87% admitted) 9,518 Admitted claims with cause of claim provided Admitted claims (counted by number of policies): Singapore 45% Hong Kong 23% Malaysia 32% 11

12 Cause of Claim by Territory 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Cause of Claim by Territory Hong Kong Malaysia Singapore Overall Others Total Permanent Disability Other heart surgery excluding Coronary Artery Bypass Surgery Coronary Artery Bypass Surgery Kidney Failure Stroke Heart Attack Cancer Cause of Claim 12

13 Cause of Claim by Duration Breakdown by sex and duration Sex Male Female Duration Number of Claims Cancer 49.5% 53.6% 50.7% 81.8% 83.1% 84.9% Heart Attack 19.5% 19.3% 21.1% 1.6% 1.5% 1.8% Stroke 7.6% 9.3% 9.0% 4.2% 3.4% 4.1% CABS 4.3% 4.7% 4.4% 0.4% 0.4% 0.2% Kidney Failure 2.3% 3.2% 3.6% 3.0% 2.1% 2.2% Other heart surgery excluding CABS 2.8% 2.2% 2.1% 0.7% 0.5% 0.6% TPD 1.8% 1.5% 1.4% 0.4% 0.2% 0.6% Others 12.2% 6.1% 7.7% 8.0% 8.8% 5.5% Cause of Claim 13

14 The Most Common Other Causes of Claim Other Claims Hong Kong Malaysia Singapore Other claims (cause reported) 1st place 2nd place 3rd place Benign brain tumor 14 (8%) Paralysis 12 (7%) Paralysis 20 (9%) Benign brain tumor Coma 13 (5%) 10 (6%) Coma 13 (5%) Benign brain tumor 25 (18%) Encephalitis 10 (7%) 19 (9%) Coma 10 (7%) Blindness Multiple Sclerosis 8 (6%) Cause of Claim 14

15 Cause of Claim by Age Males Claims: % 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Others Total Permanent Disability Other heart surgery excluding CABS Coronary Artery Bypass Surgery (CABS) Kidney Failure Stroke Heart Attack Cancer Cause of Claim 15

16 Cause of Claim by Age Females Claims: % 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Others Total Permanent Disability Other heart surgery excluding CABS Coronary Artery Bypass Surgery (CABS) Kidney Failure Stroke Heart Attack Cancer Cause of Claim 16

17 Claims Analysis Background information Claims analysis Admitted claims Declinature Cancer claims Incidence rates 17

18 Declinature Rate 25% Declinature rate by calendar year 20% 15% 10% Hong Kong Malaysia Singapore Overall 5% 0% Declinature 18

19 Declinature Rate Declinature Rate by Sex and Territory Male Female 9% 11% 11% 12% 18% 19% Hong Kong Malaysia Singapore 0% 5% 10% 15% 20% Declinature 19

20 Declinature Rate Declinature Rate by Cause of Declinature Suicide Not Covered Definition Not Met Within Waiting Period Non-disclosure Others 0% 5% 10% 15% 20% 25% 30% * Only 11% of declined claims gave the reason for declinature. Declinature 20

21 Declinature Rate Declinature Rate by Cause of Claim Cancer Stroke Heart Attack Coronary Artery Bypass Surgery Kidney Failure Others 0% 5% 10% 15% 20% 25% 30% Declinature 21

22 Claims Analysis Background information Claims analysis Admitted claims Cancer claims Incidence rates 22

23 Selection Effect: Insured Lives Cancer Rates Comparing survey results with population statistics on cancer Notes: Population statistics may include more than one primary cancer site No population data for Malaysia available Source of population statistics: Hong Kong Cancer Registry New cancer cases in year 2000 (all sites excluding skin) Singapore Cancer Registry Report No. 5 - Cancer Incidence in Singapore (all sites excluding skin) Cancer Claims 23

24 Selection Effect Hong Kong Crude Cancer Incidence rates - Male Insured lives ( ) Population (2000) Insured lives/population No. of Claims Cancer incidence Cancer incidence Ratio Duration Duration (all sites but skin) Duration Age 2+ All 2+ All 2+ All % 65% % 79% % 70% % 85% % 80% % 56% % 50% % 38% Cancer Claims 24

25 Selection Effect Hong Kong Crude Cancer Incidence rates - Female Insured lives ( ) Population (2000) Insured lives/population No. of Claims Cancer incidence Cancer incidence Ratio Duration Duration (all sites but skin) Duration Age 2+ All 2+ All 2+ All % 102% % 81% % 92% % 93% % 87% % 68% % 63% % 89% Cancer Claims 25

26 Selection Effect Singapore Crude Cancer Incidence rates - Male No. of Claims Cancer incidence Cancer incidence Ratio Duration Duration (all sites but skin) Duration Age 2+ All 2+ All 2+ All % 44% % 110% % 108% % 89% % 59% % 31% % 60% % 63% Cancer Claims 26

27 Selection Effect Singapore Crude Cancer Incidence rates Female Insured Insured lives ( ) Population (2000) lives/population No. of Claims Cancer incidence Cancer incidence Ratio Duration Duration (all sites but skin) Duration Age 2+ All 2+ All 2+ All % 77% % 127% % 96% % 112% % 98% % 75% % 99% % 98% Cancer Claims 27

28 Site of Cancer (Insured Lives - Male) Hong Kong, Malaysia & Singapore 12% 10% 14% 4% Bone and connective tissue, skin and breast Digestive organs and peritoneum Genitourinary organs Lip, oral cavity and pharynx 27% Lymphatic and haematopoietic tissue Other and unspecified 25% 8% Respiratory and intrathoracic organs Cancer Claims 28

29 Site of Cancer (Hong Kong Insured Lives - Male) Hong Kong 10% 10% 10% 3% Bone and connective tissue, skin and breast Digestive organs and peritoneum Genitourinary organs Lip, oral cavity and pharynx 32% 7% 28% Lymphatic and haematopoietic tissue Other and unspecified Respiratory and intrathoracic organs Cancer Claims 29

30 Site of Cancer (Hong Kong Population - Male) New Cancer Cases in Year 2000 (Age 20-49) 9% 5% 13% 3% Bone and connective tissue, skin and breast Digestive organs and peritoneum Genitourinary organs Lip, oral cavity and pharynx 29% 34% Lymphatic and haematopoietic tissue Other and unspecified 7% Respiratory and intrathoracic organs Cancer Claims 30

31 Site of Cancer (Insured Lives - Female) Hong Kong, Malaysia & Singapore 18% 6% 5% 10% 5% Bone and connective tissue, skin and breast Digestive organs and peritoneum Genitourinary organs Lip, oral cavity and pharynx 11% 45% Lymphatic and haematopoietic tissue Other and unspecified Respiratory and intrathoracic organs Cancer Claims 31

32 Site of Cancer (HK Insured Lives - Female) Hong Kong 10% 5% 9% 4% Bone and connective tissue, skin and breast Digestive organs and peritoneum Genitourinary organs Lip, oral cavity and pharynx 18% 42% Lymphatic and haematopoietic tissue Other and unspecified 12% Respiratory and intrathoracic organs Cancer Claims 32

33 Site of Cancer (Hong Kong Population - Female) New Cancer Cases in Year 2000 (Age 20-49) 9% 6% 9% 6% Bone and connective tissue, skin and breast Digestive organs and peritoneum Genitourinary organs Lip, oral cavity and pharynx 20% 38% Lymphatic and haematopoietic tissue Other and unspecified 12% Respiratory and intrathoracic organs Cancer Claims 33

34 Female Breast Cancer Claims % of Female Cancer Claims due to Breast Cancer Hong Kong Malaysia Singapore Overall 0% 10% 20% 30% 40% 50% Cancer Claims 34

35 Female Breast Cancer Claims Age distribution of female breast cancer claims Age % 10% 20% 30% 40% 50% 60% Hong Kong Malaysia Singapore Overall Cancer Claims 35

36 Female Cancer Claims In-force duration of female claims Breast Cancer Classified* Cancers All Cancers All Dread Diseases 0% 20% 40% 60% 80% 100% duration 0 duration 1 duration 2+ *This refers to cancer claims for which the sites are available Cancer Claims 36

37 Claims Analysis Background information Claims analysis Declinatures Admitted claims Cancer claims Incidence rates 37

38 Acceleration Type Dread Disease Policies Acceleration Type Benefit 20,000 Death cover 5,000 Dread Disease cover Dread Disease Death Payment of 5,000 Death Payment of 20,000 Payment of 15,000 Incidence Rates & Actual/Expected Ratio Analysis 38

39 Incidence Rates: Death with Acceleration DD Males Based on 2,301 actual claims Incidence Rates %? in comparison with last DD survey ( ) Age Crude rates 2003 Graduated rates 2003 Graduated rates 2000 Incidence Rates & Actual/Expected Ratio Analysis 39

40 Incidence Rates: Death with Acceleration DD Females Based on 2,291 actual claims Incidence Rates %? in comparison with last DD survey ( ) Age Crude rates 2003 Graduated rates 2003 Graduated rates 2000 Incidence Rates & Actual/Expected Ratio Analysis 40

41 Incidence Rates: Death with Acceleration DD Death with Dread Disease Acceleration Incidence Rates (log scale) Male Female Age Incidence Rates & Actual/Expected Ratio Analysis 41

42 Incidence Rates: Acceleration DD only Dread Disease only (Acceleration type) Incidence Rates (log scale) Male Female Age Incidence Rates & Actual/Expected Ratio Analysis 42

43 Initial Selection Effect by Territory Acceleration DD, age range 20 60, males All territories Duration 0 No of claims 602 A/E 110% Duration % Duration % *Duration 0 exposure = No of lives * (1 waiting period in days / 365) Initial Selection 43

44 Initial Selection Effect by Territory Acceleration DD, age range 20 60, males All territories Hong Kong No of claims A/E A/E Duration % 93% Duration % 91% Duration % 98% *Duration 0 exposure = No of lives * (1 waiting period in days / 365) Initial Selection 44

45 Initial Selection Effect by Territory Acceleration DD, age range 20 60, males All territories Hong Kong Malaysia No of claims A/E A/E A/E Duration % 93% 135% Duration % 91% 102% Duration % 98% 103% *Duration 0 exposure = No of lives * (1 waiting period in days / 365) Initial Selection 45

46 Initial Selection Effect by Territory Acceleration DD, age range 20 60, males All territories Hong Kong Malaysia Singapore No of claims A/E A/E A/E A/E Duration % 93% 135% 94% Duration % 91% 102% 103% Duration % 98% 103% 99% *Duration 0 exposure = No of lives * (1 waiting period in days / 365) Initial Selection 46

47 Initial Selection Effect by Territory Acceleration DD, age range 20 60, females All territories Duration 0 No of claims 664 A/E 90% Duration % Duration % *Duration 0 exposure = No of lives * (1 waiting period in days / 365) Initial Selection 47

48 Initial Selection Effect by Territory Acceleration DD, age range 20 60, females All territories Hong Kong No of claims A/E A/E Duration % 86% Duration % 85% Duration % 107% *Duration 0 exposure = No of lives * (1 waiting period in days / 365) Initial Selection 48

49 Initial Selection Effect by Territory Acceleration DD, age range 20 60, females All territories Hong Kong Malaysia No of claims A/E A/E A/E Duration % 86% 96% Duration % 85% 71% Duration % 107% 82% *Duration 0 exposure = No of lives * (1 waiting period in days / 365) Initial Selection 49

50 Initial Selection Effect by Territory Acceleration DD, age range 20 60, females All territories Hong Kong Malaysia Singapore No of claims A/E A/E A/E A/E Duration % 86% 96% 88% Duration % 85% 71% 92% Duration % 107% 82% 109% *Duration 0 exposure = No of lives * (1 waiting period in days / 365) Initial Selection 50

51 Initial Selection Effect Additional DD, Male (age 25-60) Female (age 25-55) No of claims A/E No of claims A/E Duration % 73 73% Duration % 91 80% Duration % % *Duration 0 exposure = No of lives * (1 waiting period in days / 365) Initial Selection 51

52 Analysis by Smoking Status No of claims Males A/E No of claims Females A/E Acceleration DD Smoker % % Nonsmoker % % Additional DD Smoker % % Nonsmoker % % Smoking 52

53 Analysis by Smoking Status 250% 200% Smoker/non-smoker differential by age group 150% 100% Male Female 50% 0% Smoking 53

54 Analysis by Calendar Year Males A/E Ratios by Calendar Year 120% 110% 100% 90% 80% 70% Hong Kong Malaysia Singapore Overall Trends 54

55 Analysis by Calendar Year Females A/E Ratios by Calendar Year 140% 130% 120% 110% 100% 90% 80% 70% 60% Hong Kong Malaysia Singapore Overall Trends 55

56 Contents 1. Gen Re s Survey 2. International Comparisons 3. Trends in Cancer Incidence 4. For Your Consideration 56

57 International Comparisons Hong Kong, Malaysia and Singapore (HKMS) Gen Re s Survey ( ) Taiwan Life Insurance Association ( ) UK Report of the Healthcare Study Group ( ) Australia Gen Re Australia Trauma Experience Analysis South Africa Gen Re South Africa Trauma experience Analysis, International Comparison 57

58 Cause of Claim Gen Re s survey Hong Kong, Malaysia and Singapore Sex Male Female Duration Number of Claims Cancer 49.5% 53.6% 50.7% 81.8% 83.1% 84.9% Heart Attack 19.5% 19.3% 21.1% 1.6% 1.5% 1.8% Stroke 7.6% 9.3% 9.0% 4.2% 3.4% 4.1% CABS 4.3% 4.7% 4.4% 0.4% 0.4% 0.2% Kidney Failure 2.3% 3.2% 3.6% 3.0% 2.1% 2.2% Other heart surgery excluding CABS 2.8% 2.2% 2.1% 0.7% 0.5% 0.6% TPD 1.8% 1.5% 1.4% 0.4% 0.2% 0.6% Others 12.2% 6.1% 7.7% 8.0% 8.8% 5.5% Claims Experience 58

59 Cause of Claim - Taiwan Taiwan Sex Male Female Year Number of Claims 921 1,398 2,013 2,539 3,396 1,187 1,637 2,325 2,881 3,731 Cancer 76.8% 78.0% 75.2% 72.9% 73.3% 89.0% 90.2% 88.5% 88.3% 88.1% Heart Attack 7.3% 7.5% 8.6% 9.3% 9.1% 0.6% 0.4% 1.0% 1.1% 0.9% Stroke 4.1% 3.6% 5.0% 4.8% 5.4% 1.9% 1.5% 1.5% 1.6% 1.8% Coronary Artery Bypass 1.4% 1.8% 2.5% 2.4% 2.3% 0.3% 0.5% 0.5% 0.5% 0.4% Kidney Failure 7.3% 7.4% 7.0% 8.1% 7.5% 7.2% 6.4% 7.6% 7.2% 7.8% Major Organ Transplant 1.3% 0.4% 0.3% 1.4% 0.4% 0.5% 0.4% 0.2% 0.6% 0.1% Paralysis 1.8% 1.3% 1.3% 1.2% 2.2% 0.7% 0.7% 0.7% 0.9% 0.9% International Comparisons 59

60 Cause of Claim - UK UK Sex Male Female Duration Cancer 43.2% 49.3% 41.1% 79.7% 79.4% 74.4% Heart Attack 34.6% 25.2% 31.2% 2.1% 2.7% 2.3% Stroke 7.1% 9.8% 8.6% 6.2% 7.0% 6.5% Coronary Artery 6.6% 5.3% 7.1% 1.2% 0.0% 0.8% Bypass Graft Multiple Sclerosis 3.1% 3.3% 3.6% 6.1% 3.8% 8.6% Kidney Failure 1.2% 1.6% 0.8% 1.6% 0.0% 0.5% Major Organ 1.2% 0.0% 0.5% 0.5% 1.0% 0.0% Transplant PTD 3.0% 5.5% 7.1% 2.6% 6.1% 6.9% *** Claims from other causes made up about 2% of male and female DD claims International Comparisons 60

61 Cause of Claim - Australia Australia Sex Male Female Duration Number of Claims Cancer 46.6% 44.4% 43.0% 69.4% 84.1% 82.0% Heart Attack 1.7% 26.4% 27.5% 2.8% 1.6% 3.3% Stroke 6.9% 4.2% 1.9% 11.1% 4.8% 4.7% Coronary Artery Bypass Graft 6.9% 4.2% 7.8% 0.0% 0.0% 0.0% Kidney Failure 0.0% 0.0% 0.3% 0.0% 0.0% 0.0% Other 37.9% 20.8% 19.4% 16.7% 9.5% 10.0% International Comparisons 61

62 Cause of Claim South Africa South Africa Sex Male Female Number of claims Cancer 29% 74% Heart Attack 57% 12% Stroke 7% 12% Other 7% 2% International Comparisons 62

63 Contents 1. Gen Re s Survey 2. International Comparisons 3. Trends in Cancer Incidence 4. For Your Consideration 63

64 Population Trends in Cancer - UK 650 UK: crude rates (age 20+) Rate per 100, Male Female Trends 64

65 Population Trends in Cancer - UK 160 UK: male by site Prostate Lung Colorectal *** Age standardised rates adjusted to 100 in 1989 Trends 65

66 Population Trends in Cancer - UK 120 UK: female by site Lung Breast Cervix Colorectal *** Age standardised rates adjusted to 100 in 1989 Trends 66

67 Population Trends in Cancer Hong Kong 400 Hong Kong: crude rates Rate per 100, Male Female Trends 67

68 Population Trends in Cancer Hong Kong Hong Kong: male by site Trends *** Age standardised rates adjusted to 100 in Prostate Rectum Nasopharynx Lung Stomach 68

69 Population Trends in Cancer Hong Kong 140 Hong Kong: female by site Trends *** Age standardised rates adjusted to 100 in 1989 Breast Nasopharynx Lung Cervix 69

70 Population Trends in Cancer Hong Kong 350 Age standardised incidence rates Rate per 100, Male Female Trends 70

71 Trends in Cancer Hong Kong Insured Lives Rate per 100, Age Adjusted Cancer Incidence Rate (Age20-60) Male Female Trends 71

72 Trends in Heart Attack, Stroke & Heart Surgery 30 Age Adjusted Incidence Rate Hong Kong Male Insured Lives (Age 20-60) Rate per 100, HA, Stroke, CABS, Heart Surgery Trends 72

73 Population mortality by cause of death HK Mortality per Age Malignant neoplasms Heart diseases Injury and poisoning Cerebrovascular disease Pneumonia, all forms All other causes Trends 73

74 Population mortality by cause of death HK Mortality per Age Malignant neoplasms Heart diseases Injury and poisoning Cerebrovascular disease Pneumonia, all forms All other causes Trends 74

75 Population Trends in Cancer - Taiwan Taiwan: crude rates 300 Rate per 100, Male Female Trends 75

76 Population Trends in Cancer - Taiwan Taiwan: age standardised rates 250 Rate per 100, Male Female Trends 76

77 Trends in Cancer Taiwan Insured Lives Taiwan: crude rates 150 Rate per 100, Male Female Trends 77

78 Trends in Cancer Taiwan Insured Lives Taiwan: age standardised rates 150 Rate per 100, Male Female Trends 78

79 Trends in Heart Attack, Stroke & CABS Taiwan insured lives: crude rates 25 Rate per 100, Male Female Trends 79

80 Trends in Heart Attack, Stroke & CABS Taiwan insured lives: age standardised rates 25 Rate per 100, Male Female Trends 80

81 Contents 1. Gen Re s Survey 2. International Comparisons 3. Trends in Cancer Incidence 4. For Your Consideration 81

82 For Your Consideration Shape of rates Definitions 82

83 For Your Consideration Life-threatening Cancer Means the presence of one or more malignant tumours. The malignant tumour is to be characterised by the uncontrollable growth and spread of malignant cells and the invasion and destruction of normal tissue for which major interventionist treatment or surgery (excluding endoscopic procedures alone) is considered medically necessary. The following tumours are excluded: Tumours showing the malignant changes of carcinoma in situ (including cervical dysplasia CIN-1, CIN-2 and CIN-3) or which are histologically described as pre-malignant; All skin cancers including hyperkeratoses, basal cell carcinomas, squamous cell carcinomas and Melanomas of less than 1.5 mm maximum thickness as determined by histological examination using the Breslow method, unless there is evidence of metastasis; Non Life-threatening Cancers such as Prostatic cancers which are histologically described as TNM Classification T1 or are of another equivalent or lesser classification, Papillary Micro-Carcinoma of the Thyroid or Bladder and Chronic Lymphocytic Leukaemia less than Rai Stage 3. 83

84 For Your Consideration Shape of rates Definitions Medical advance & trends 84

85 For Your Consideration Premium Rate Guarantee No. of companies % of in force policies Guaranteed Total Guaranteed Hong Kong: % Malaysia: % Singapore: % Reviewability of definitions None 85

86 For Your Consideration Reviewability Clause Your policy cannot be cancelled by us due to a deterioration in your health or changes in your occupation or pastimes. Your Dread Disease Plan provides financial assistance in the event that you suffer a substantial loss as a result of one of the specified Dread Diseases defined in your Policy Document. Due to the continuing advances in medical treatment and diagnostic techniques, we may need to review the Definitions used in your Policy Document to ensure that in the future they: - remain appropriate with regard to medical terminology and classification, - take into account effective cures and vaccines and modern diagnostic procedures, - include diseases considered appropriate in the future, - exclude diseases which are found to have become minor. We reserve the right, therefore, to adjust your Dread Disease Definitions and/or premium. 86

87 For Your Consideration Shape of rates Definitions Medical advance & trends Effect on mortality studies 87

88 For Your Consideration Death Claims cf. Mortality Tables HKA01 M83/88 Male Female S88/93 0% 10% 20% 30% 40% 50% 88

89 ? Questions? 89