Topic:
Agenda
Introduction
Medical Advances and Technologies
Genetic Testing
Digital Transformation and Big Data
Case Study: Cancer A Look Into the Future
The Future of Life and Health Insurance
FAMILY HISTORY
Technology empowering
consumers with greater
personal biometric and
behavioural insights heightening
information asymmetry but
also informed choice, and
organisations who understand
the data to know consumers
more than they know
themselves
Ageing societies
Social change
Digital Health
Technological advances enable the gathering of data from the physical world,
enabling insurers to generate new insights (eg health info from wearables); develop
products that better match consumer needs; deliver services that add value (eg
health/disease management) through more channels; it also creates new models of
distribution & a new world of connected consumers .
Connected
Consumers
Greater access to technology & data allows consumers to be more informed about
and take more control of their health status, engage with healthcare providers,
social networks and the broader ecosystem (eg insurers)
Big Data
To be useful, data must be aggregated and analysed. Insurers need to access big
and small data from a variety of traditional and new sources to gain market insights,
and then analyse to provide useful outputs. Issues such as ownership, privacy and
control remain key.
Radical
Medical
Advances
Rapid Ageing
Source: The World Health Organization Annual World Health Statistics Reports, Part 7 Health Expenditure; the United
Nations; national statistics and Swiss Re projections
Advancements can change the landscape for the way insurance companies Underwrite
the risks, and manage claims.
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Disruptive Technologies:
With potential high impact to health outcomes
1. Mobile Internet
2. Automation of knowledge work
3. The Internet of Things
Health and chronic
disease monitoring
4. Cloud technology
5. Advanced robotics
Robotic surgery
and prosthetics
6. Near-autonomous vehicles
Reduction in
car accidents
7. Next-generation genomics
Predictive health
analytics
8. Energy storage
9. 3D printing
Organ
bioprinting
10. Advanced materials
Nanodrugs
11. Oil and gas exploration and recovery
12. Renewable energy
Next-generation genomics
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Genetic Testing
12
13
Testing Uses
14
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Source: Genetic testing and implications for the Life & Health insurance industry, Florian Rechfeld - Swiss Re
Source: Genetic testing and implications for the Life & Health insurance industry, Florian Rechfeld - Swiss Re
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18
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Digital Transformation
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Explosion of data
volume
Rapid change in
consumer behaviour
Significant
improvements of
sensing and analytical
capabilities
Proliferation of digital
platforms/market places
Substantial increase in
computational power
Emergence of agile
digital native primary
attackers
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Retention
Focus on customer stickiness
Customer loyalty and tailored solutions
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23
24
Case Study
Cancer A look into the future
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27
Increasing loss
Uncertain claims
Best estimate
Parameter error
Adverse trend
temporary shock
step change
Time
Future Incidence
Methods to estimate future incidence rates can be broadly grouped
into 4 categories
ignore
benchmark
compare with other markets, particularly if data is sparse
retrospective projection
extrapolate past trends
prospective projection
analysis of future drivers
What is appropriate?
Retrospective projection
Derive a trend mainly from the numeric incidence rates in the past; and
Apply this trend for the future for a period of time with/without a cap.
Features
Simple & easy to explain
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Drilling deeper
600%
1983-1987
1998-2002
2008-2011
500%
400%
300%
200%
100%
85+
80-85
70-75
60-65
50-55
0%
40-45
Breast cancer
Breast Cancer Incidence
Rate in Shanghai
(Age Adjusted)
45
40
100
90
30
25
20
15
10
80
70
60
Shanghai
50
Japan
40
Taiwan
30
UK
20
USA
10
0
1973
1976
1979
1982
1985
1988
1991
1994
1997
2000
2003
2006
2009
35
1973 1978 1983 1988 1993 1998 2003 2008 2013 2018 2023 2028
50
40
30
4
3
20
10
1995
1985
1975
1965
1955
1945
2008
2003
1998
1993
1988
1983
1978
1973
Prospective projection
Emphasis of understanding of risk factors, with focus on key and modifiable
ones
Evaluate the relative importance (e.g. attributable fraction) of risk factors
Project the change of these risk factors and measure the impact on cancer
incidence rate
Features
Less reliance on past experience data
More complex
38
39
41
42
43
100
100
80
60
60
Best Estimate
70
Past Experience
70
5
100
96
Best Estimate
80
Behavioural
Intervention 2
90
Behavioural
Intervention 1
90
100
100
Medical Advance 2
110
Medical Trend
110
10
Past Experience
120
The Future
Medical Advance 1
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Some Considerations
the Underwriters & Claims Specialists
Risk selection tools well established existing process, but
aligned with new product intent?
Provision terms are only meaningful if executed
Changes who's keeping track?
"OK as long as it is priced for?"
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Thank you
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