Industry Critical Illness Survey Eddie McEllin Senior Actuary - PowerPoint PPT Presentation

Industry Critical Illness Survey Eddie McEllin Senior Actuary Tel. +61 2 8236 6206 eddie.mcellin@genre.com

About the Survey Survey covered 9 Australian insurers of Trauma insurance Annual Premium $m, % AIG, 43.5, 2% ASTERON, 186.4, AVIVA, 114.4, 4% 7% WESTPAC, 207.9, 8% CBA, 365.4, 14% ING, 305.9, 11% TOWER, 249.6 , 9% ZURICH, 98.4, 4% MLC, 366.7, 14% Not Covered, 746.1, 27% Major carriers not covered: AMP 11%, AXA 8% Source: “ Media Release Life Insurance Risk Products Industry Results - June 2006 ” Industry Critical Illness Survey 2

Scope of the experience investigation 5 – Year Observation Period 2001/01/01 2002/01/01 2003/01/01 2004/01/01 2005/01/01 2005/12/31 1) Critical Illness in-force at any time during 2001-2005 2) Critical Illness claims diagnosed during 2001-2005 • Claims data includes 3902 claims incurred and $537million in claims paid. • Exposure data includes 1.57million life years and 238 billion is sum assured. • Incidence rates obtained from claim count divided by central exposed to risk at age next birthday. Includes both accelerated and stand alone trauma claims, but excludes death claims. • Graduated rates obtained by from male and female, 2+ duration, raw incidence rates. Industry Critical Illness Survey 3

Distribution of Exposure by Age Female Male All 40.4 41.4 40.9 Average Age 20-29 9% 9% 9% 30-39 37% 32% 35% Gender Mix 40-49 40% 40% 40% Female = 46% Male = 54% 50-59 13% 17% 16% >60 1% 1% 1% 5% Female Male 4% 3% 2% 1% 0% 20 25 30 35 40 45 50 55 60 65 Industry Critical Illness Survey 4

Trauma Incidence Rates (Male) Trauma only (2+ Duration, Accelerated and Stand Alone) Male Male 0.020 0.020 Raw Raw Graduated Graduated Incidence Rates Incidence Rates 0.015 0.015 0.010 0.010 0.005 0.005 0.000 0.000 20 20 25 25 30 30 35 35 40 40 45 45 50 50 55 55 60 60 65 65 Age Age Total Male Data: 1831 claims, 565,143 life years Australian Critical Illness Survey 5

Trauma Incidence Rates (Female) Trauma only (2+ Duration, Accelerated and Stand Alone) Female Female 0.012 0.012 Raw Raw Graduated 0.010 0.010 Graduated Incidence Rates Incidence Rates 0.008 0.008 0.006 0.006 0.004 0.004 0.002 0.002 0.000 0.000 20 25 30 35 40 45 50 55 60 65 20 25 30 35 40 45 50 55 60 65 Age Age Total Female Data: 1200 claims, 498,364 life years Australian Critical Illness Survey 6

Trauma Incidence Rates Male / Female Comparison 0.0200 Male 0.0180 Female 0.0160 0.0140 Incidence Rates 0.0120 0.0100 0.0080 0.0060 0.0040 0.0020 0.0000 20 25 30 35 40 45 50 55 60 65 Age Industry Critical Illness Survey 7

Trauma Incidence Rates (Male) Comparison with International Trauma Survey 2000-2004 International includes: Hong Kong, Malaysia, and Singapore 0.0140 Australian 0.0120 International 0.0100 Incidence Rates 0.0080 0.0060 0.0040 0.0020 0.0000 20 25 30 35 40 45 50 55 60 Age Industry Critical Illness Survey 8

Trauma Incidence Rates (Female) Comparison with International Trauma Survey 2000-2004 Comparison with International Trauma Survey 2000-2004 International includes: Hong Kong, Malaysia, and Singapore 0.0080 Australian 0.0070 International 0.0060 Incidence Rates 0.0050 0.0040 0.0030 0.0020 0.0010 0.0000 20 25 30 35 40 45 50 55 60 Age Industry Critical Illness Survey 9

Distribution of Claims by Age (Male) 34.7 60.3 5% 90% 5% 140 Expected 120 Actual 100 # of Claims 80 60 40 20 0 20 25 30 35 40 45 50 55 60 65 48.9 Age Mean 90% of the claims are incurred between ages 34.7 and 60.3 Industry Critical Illness Survey 10

Distribution of Claims by Age (Female) 33.1 57.6 5% 90% 5% 90 Expected 80 Actual 70 60 # of Claims 50 40 30 20 10 0 20 25 30 35 40 45 50 55 60 65 46.0 Age Mean 90% of the claims are incurred between ages 33.1 and 57.6 Industry Critical Illness Survey 11

Distribution of Claims Male / Female Comparison 140 Male 120 Female 100 # of Claims 80 60 40 20 0 20 25 30 35 40 45 50 55 60 65 Age Industry Critical Illness Survey 12

Comparison by Calendar Year Male A/E Ratios by Calendar Year Female 120% 100% 105% 105% 105% 101% 100% 95% 94% 95% 93% 80% 86% 60% 40% 20% 0% 2001 2002 2003 2004 2005 Australian Critical Illness Survey 13

Comparison by Duration A/E Ratios by Selection Period 96% Duration 0 Male 96% Female 90% Duration 1 80% 100% Duration 2+ 100% 104% Duration 5+ 106% 70% 80% 90% 100% 110% Industry Critical Illness Survey 14

Comparison by Smoking Status A/E Ratios by Smoking Status Male Female 96% Non-smoker 96% 122% Smoker 105% 70% 100% 130% Industry Critical Illness Survey 15

Comparison by Sum Assured A/E Ratios by Sum Assured Amount 88% Male <50k 91% Female 93% 50k-100k 91% 105% 100k-150k 104% 106% 150k-250k 95% 100% >250k 112% 80% 90% 100% 110% 120% Industry Critical Illness Survey 16

Time from Event Date to Notification <=30 31-60 61-90 91-180 >180 16% 17% 18% 19% 10% 10% 9% 11% 8% 8% 10% 7% 21% 21% 19% 20% 44% 44% 44% 43% Duration 0 Duration 1 Duration 2+ All Durations 116 Days Avg Time = 130 Days 134 Days 119 Days Industry Critical Illness Survey 17

Time from Notification to Benefit Payment <=30 31-60 61-90 91-180 >180 9% 11% 18% 20% 22% 24% 27% 34% 21% 22% 22% 25% 33% 30% 22% 15% 15% 13% 10% 5% Duration 0 Duration 1 Duration 2+ All Durations 90 Days Avg Time = 135 Days 129 Days 99 Days 217 Days 204 Days Time from Event to Payment = 265 Days 262 Days Industry Critical Illness Survey 18

Cause of Claim by Site Males (% Total) Cardiac, 35% Cancer, Cardiac, and Stroke, 5% Stroke account for 90% Other Neuroligical, 2% of male claims Other, 8% Females (% Total) Cancer, 50% Cardiac, 6% Stroke, 4% Cancer, 80% Other Neurological, 4% Other, 6% Industry Critical Illness Survey 19

Cause of Claim by Age and Site Gender Female Male Age Band 20-29 30-39 40-49 50-59 60+ 20-29 30-39 40-49 50-59 60+ Number of Claims 25 279 706 489 36 25 254 844 1074 170 Cancer 52.0% 76.0% 84.0% 83.0% 58.3% 52.0% 58.7% 47.6% 49.7% 50.0% Cardiac/Heart Attack 0.0% 5.4% 5.2% 7.2% 19.4% 12.0% 18.9% 37.2% 36.8% 38.2% Stroke 12.0% 4.3% 3.4% 2.7% 11.1% 12.0% 6.7% 4.0% 5.2% 5.3% Neurological (MS) 16.0% 6.5% 2.1% 2.9% 11.1% 0.0% 3.5% 1.4% 2.2% 0.6% Organ Disorders 4.0% 2.5% 0.7% 1.2% 0.0% 4.0% 0.8% 1.2% 0.5% 0.6% Head Trauma/Coma 4.0% 0.7% 0.7% 0.8% 0.0% 4.0% 2.8% 1.3% 0.7% 0.6% Accidents 4.0% 0.4% 0.4% 0.0% 0.0% 12.0% 2.4% 2.1% 0.5% 0.6% Loss of Abilities 0.0% 0.0% 0.6% 0.2% 0.0% 0.0% 0.8% 1.1% 0.5% 1.2% Paralysis 0.0% 0.0% 0.0% 0.2% 0.0% 0.0% 2.0% 0.1% 0.2% 0.0% Blood Disorders 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.4% 0.0% 0.0% 0.0% Transplants 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.4% 0.0% 0.0% Other 8.0% 4.3% 2.8% 1.8% 0.0% 4.0% 3.1% 3.6% 3.7% 2.9% Industry Critical Illness Survey 20

Cause of Claim International Comparison MALE 100% Other 90% 80% Accidents 70% 60% 50% Neurological/Stroke 40% 30% Cardiac/Heart Attack 20% 10% 0% Cancer Australia UK Malaysia China FEMALE 100% Other 90% 80% Organ Disorders 70% 60% 50% Neurological/Stroke 40% 30% Cardiac/Heart Attack 20% 10% 0% Cancer Australia UK Malaysia China Industry Critical Illness Survey 21

Cancer Incidence Rates Male / Female Comparison 0.0100 0.0090 Male Female 0.0080 0.0070 Incidence Rates 0.0060 0.0050 0.0040 0.0030 0.0020 0.0010 0.0000 20 25 30 35 40 45 50 55 60 65 Age Industry Critical Illness Survey 22

Cancer Incidence Rates (Male) Comparison with Population Incidence Rates 0.0180 70% Insured 0.0160 Population 60% Ins/Pop 0.0140 50% Incidence Rates 0.0120 % Difference 40% 0.0100 0.0080 30% 0.0060 20% 0.0040 10% 0.0020 0.0000 0% 20 25 30 35 40 45 50 55 60 65 Age Population cancer rates graduated from 2001 to 2004 raw incidence data. Source: Australian Institute of Health and Welfare Industry Critical Illness Survey 23

Cancer Incidence Rates (Female) Comparison with Population Incidence Rates 0.0120 80% Insured 70% Population 0.0100 Ins/Pop 60% Incidence Rates 0.0080 50% % Difference 0.0060 40% 30% 0.0040 20% 0.0020 10% 0.0000 0% 20 25 30 35 40 45 50 55 60 65 Age Population cancer rates graduated from 2001 to 2004 raw incidence data. Source: Australian Institute of Health and Welfare Industry Critical Illness Survey 24

Cancer Claims by Site Males (% Total) Reproductive & Urinary, Prostate cancer has the 36% Blood & Lymphatic, 14% greatest incidence of cancer among males (23%) Other (including brain & thryoid), 8% Mouth/Throat/Oesophagus, 6% Connective tissue (Bone, Females (% Total) Skin, Breast), 13% Respiratory / Lung, 3% Digestive Organs, 20% Reproductive & Urinary, 8% Connective tissue (Bone, Skin, Breast), 69% Blood & Lymphatic, 6% Other (including brain & thryoid), 7% Mouth/Throat/Oesophagus, 1% Digestive Organs, 7% Respiratory / Lung, 2% Industry Critical Illness Survey 25