Webinar series: IFoA Protection Health and Care and IFoA Mortality and Longevity Symposium

Introduction to the programme

Speakers: Sacha Dhamani, Prudential Assurance (Symposium Chair) and Zoe Woodroffe, Gen Re (Conference Chair)

CMI Update

•CMI_2018
•Recent mortality in the UK
•Annuities experience for 2011-2016 and draft graduations
•Assurances experience for 2011-2017
•SAPS experience for 2010-2017

Speakers: Cobus Daneel, Dave Grimshaw and Matt Fletcher, CMI

Marriage matters: a practical guide to modelling contingent dependants

With interest rates at historic lows, dependant proportions and age difference are increasingly material to pension liability calculations, with spreads of up to 6% in total liability value between the most and least affluent groups of pensioners. They have also become a growing focus for longevity swap and bulk annuity transactions and can be a key driver of price differentials.

This session offers a practical tour of the latest modelling techniques, including

-survey non-respondent bias and how to deal with it,

-tracing accuracy and interpretation of codes, and

-allowing for trends by age/gender, time and socio-economic profile.

Speaker: Andy Harding, Aon

Drug Innovation and longevity

The talk will argue trends in drug innovation in recent decades have had an underestimated causal impact on longevity improvements over the same time period.  This includes the slowdown in longevity gains since the start of this decade and, in particular, the associated decline in the rate of cardiovascular related mortality improvements.  The talk will also argue these same trends in drug innovation offer a plausible guide to future decades’ longevity trends – including the prospects of disease-modifying drugs for dementia related illnesses.

Speaker: Ivor O’Shea

Trends in the cause-specific mortality experience in England and Wales

In recent years, the improvement in all-cause mortality rates has been slowing down in England and Wales. By analysing the cause-specific mortality rates, we investigate major causes for the observed slowdown.

We use generalised linear models to model death counts in the all-cause and cause-specific mortality experience in England and Wales from 2001 to 2017. Breakpoint analysis techniques are employed for the purposes of identifying and quantifying the changes in all-cause and cause-specific mortality trends. We also address the effect of the change in cause-of-death classifications on the cause-specific mortality rates in England and Wales.

Speakers: Alexander Yiu, Heriot-Watt University 

10 longevity insights that I wish I'd known sooner

In the midst of the daily hustle and bustle, it pays to occasionally take stock, and look back at how far we've come.

Drawing on analysis from Club Vita's first 10 years, as well as other sources, I will explore 10 of the most interesting insights from the world of pension scheme longevity, including some old favourites, such as:

-the key drivers of longevity;

-variations between pension schemes.

A few perhaps less well known topics, such as:

-some intriguing demographic features;

-exploring non-pensioner experience;

-scenarios for future improvements; and

-a look overseas.

Speaker: Conor O'Reilly, Club Vita

Longevity trend risk over limited time horizons

Solvency II regulations in the EU, and similar regulations elsewhere, specify a one-year, value-at-risk (VaR) approach to solvency assessment.  However, there are other horizons besides one year where a value-at-risk assessment of longevity trend risk is useful. One example is the 3-5 year horizon for a Pillar II ORSA requirement of Solvency II, another is for pension schemes aiming to achieve a level of funding for a buy-out and a third is the payout of an index-based longevity hedge. This presentation looks at n-year VaR and CTE assessments of longevity trend risk for these use-case scenarios, and contrasts the results with the usual one-year view. We consider the longevity risk in both deferred and immediate annuities.

Speaker:Stephen Richards, Longevitas 

Waste not – Calibrating mortality models using all information

The common approach to calibrating stochastic age-period-cohort (APC) models is to decompose the data into various APC components, choose which components to model and finally to fit ARIMA processes to them. This unfortunately discards information on the uncertainty of the observations and obscures both identifiability issues and the common aspects of smoothing and fitting ARIMA processes.

We present a new approach that

• calibrates models in a single step,
• fully incorporates information on observation uncertainty,
• treats smoothing and ARIMA processes consistently (calibrating both),
• calculates information criteria based on all information, and
• enables a coherent treatment of identifiability for the whole model.

Speaker: Tim Gordon, Aon

Launching an impaired life proposition in 10 weeks

On 7 September 2017, Just Retirement announced they would withdraw from the impaired lives market. Less than 10 weeks later, The Exeter wrote its first impaired life case. The talk will cover

• The decision process
• What it means to be a mutual in the 2010s
• Lessons learned
• What happened next?
• Would we do it again?

Speaker: John Gunn, The Exeter

Population Health Management Working Party

Population Health Management considers the distribution of health outcomes within a population and how to impact these outcomes in the most optimal way for the group as a whole.  The Working Party will initially focus on the specific topic of impactability modelling, an area where actuarial skills can help bring insight to some of the strategic challenges the NHS is facing.  This session will provide an update on the working party's research including defining impactability, understanding different modelling approaches, considering the practical challenges across the NHS as well as wider public perception and ethical issues. 

Speakers:

Alpesh Shah, PwC,

David Beddows, Optum,

Joanne Buckle, Milliman

Chris Martin, Crystallise

Sarah Culkin, NHS England

Antibiotic Resistance Working Party

Antibiotic resistance has been of increasing concern to health professionals, with the potential for millions of extra deaths worldwide. In this session, the ABR WP presents the conclusions of its two-year study.  The presentation covers a medical/biological overview, ABR modelling considerations, our results (including comparisons v HIV and insurer cat risk stresses), and an introduction to the model (available through the IFOA website). The conclusions will be of interest from both mortality and longevity perspectives.  Presentation would be similar to the 25 Feb sessional paper event (Edinburgh). 

Speakers: Matthew Edwards, Willis Towers Watson and Nicola Oliver, Medical Intelligence

Developments in mental health underwriting

Mental health problems are highlighted as a significant cause of distress and loss of productivity in the workplace.

Understanding the nature and consequences of psychological distress can be difficult during underwriting. Changing perceptions of risk have not always been incorporated into insurance practice. This has led to high profile public comments about the perception of unfair treatment of those with mental health problems in accessing insurance products.

Fair treatment of the customer is a fundamental plank of financial services regulation and this workshop explores some of the issues in developing an understanding and the practical steps to address the issue.

Speakers: Chris Ball and Lynn Timmons, Gen Re

Access, exclusion and trust in insurance

Charities, consumer groups, politicians, financial advisers, consumer journalists and our regulator are increasingly commenting on the difficulties that consumers with specific insurance needs are facing when trying to access cover, especially when using mass market distribution channels. Consumers unable to access meaningful information about or signposting too alternative providers of insurance, or lower-cost policies, can and increasingly do assume they are uninsurable or cannot afford cover, so excluding them from the market. This risks causing significant harm to the reputation of our industry and profession, additionally it brings into question the social purpose of insurance.

In this session, Johnny Timpson in his capacity as DWP Disability Champion for our Industry and Profession will discuss;

• The purpose and scope of his DWP role plus why we should all be inclusion and diversity champions.
• Why it makes sense to embrace change on a voluntary basis rather than wait till the regulator requires it - especially as the FCA in their 2019/20 business plan are signalling a greater focus on consumer outcomes going forward.
• The collaborative work he is leading to improve consumer access to individual and workplace protection.

Speaker: Johnny Timpson, Scottish Widows

Identifying avoidable admissions using international benchmarks

Traditionally, differences in international coding have made producing risk-adjusted international benchmarks challenging. Using over 10 million life-years of data, we compare the UK PMI market to our International Best Practice Benchmarks. These allow us to classify a healthcare system by its degree of healthcare-management, which reflects a system’s compliance to evidence-based-care guidelines, access/restriction to services and use of incentives. We compare this to well/loosely managed benchmarks to identify activity levels that are challenging yet achievable with optimal infrastructure. We also touch upon results from further advanced analytics including:
- General Linear Modelling
- Milliman Chronic Condition Hierarchical Grouper
- Milliman Advanced Risk Adjusters

Speakers: Natasha Singhal and Tanya Hayward, Milliman

Critical Illness: A tale of three continents

This presentation will look at critical illness across international markets, from the UK to Canada, from Eastern Europe to Israel and across Canada.  Past and potential future product evolution will be covered by speakers from three key markets.  Pricing considerations and claims experience will be compared and contrasted.

Speakers: Aisling Kennedy, Swiss Re Services and Hengchang Pan, Swiss Re

Modifiable Risks

Driven by the desire to act fairly toward policyholders as health deteriorates with age, we have developed a business model where we underwrite someone just once at the outset of the policy. 

Do we miss the opportunity to assess more accurately modifiable risks over time, price our products more fairly and allow those who take positive action to improve their health to benefit directly from their efforts.

Does it make sense that we assess health only once during the policy lifetime given the impact individuals have on their health from decisions they make about their diet, exercise and lifestyle?

Speaker:Alan Martin, Swiss Re