Canadian Standard Ordinary Life Experience

Transcription

1 Mortality Study Canadian Standard Ordinary Life Experience Individual Life Subcommittee Research Committee December 2008 Document Ce document est disponible en français 2008 Canadian Institute of Actuaries

2 MORTALITY UNDER CANADIAN STANDARD ORDINARY INSURANCE ISSUES STUDIED BETWEEN THE 2004 AND 2005 ANNIVERSARIES This is the fifty-sixth annual report submitted by the Individual Life Subcommittee of the Research Committee detailing the intercompany mortality experience for Canadian standard ordinary life insurance policies. This is the twelfth year that we have collected data in a seriatim format. We calculated exposure using the "Actuarial Exposure" method, in which a full year of exposure is credited in the year of death. We used CIA mortality tables to separately calculate the expected death claims for males and females and for smoker/non-smoker distinctions. For data submitted on a preferred basis, participating companies have included all of the classes of business (preferred and standard) in the submission. The preferred and standard non-smoker business was classified as non-smoker and the preferred and standard smoker business was classified as smoker. For data submitted without classification by sex, we used the male table. For data with attained age less than 16, we assigned mortality rates from the aggregate expected table. A contributor to the annual study brought to light and corrected an error that affected all the data that company had contributed to previous years of this study. The error was limited to the unknown underwriting block of business and involved inclusion of term conversions, elected Guaranteed Insurability Options, and other blocks with no underwriting at policy issue. Check the study reports on the CIA website for further details. The following appended tables comprise the results of the mortality study and are based on an age-nearest birthday basis: Table 1 The total experience analyzed for the select period by groups of duration and by groups of ages at issue and for the ultimate period by groups of attained ages. Table 2 Table 1 classified by sex. Table 3 Select period of Table 2 classified by: o Medical Males/Females o Non-Medical Males/Females o Paramedical Males/Females o Unknown Evidence Males/Females Table 4 Mortality ratios for policy years through. Table 4A Mortality ratios for policy years through, by smoker classification, subdivided by known/unknown underwriting. Table 5 The variation of the experience of the individual companies from the overall mortality ratio for the total intercompany experience. Table 6 Various classes in broad groups of policy years and ages at issue or attained ages. Table 7 Cause of death classified by sex. Table 8 Smoking habits classified by sex. 1

3 Table 9 Type of insurance. Table A Mortality ratios by quinquennial age groupings combined data. Table B Mortality ratios by quinquennial age groupings ultimate data. We show Tables 1, 2, 4 and 8 based on 5 year aggregate data ( ). We have also included Tables 1, 2, and 8 broken down by the following face amount bands: o < $100,000 o $100,000-$249,000 o $250,000 and over 1

4 Comments on the tables and additional information The study is based on data from eight contributing companies. Table C1: Companies that participated in the and studies Company Includes Contribution AEGON Transamerica Life Transamerica Life 13.94% 13.60% Desjardins Laurentian Life Great-West Life NN Financial Imperial Life Laurier London Life Canada Life Crown Life New York Life CNA NN Financial Imperial Life Laurier London Life Canada Life Crown Life New York Life CNA 4.63% 4.09% 24.25% 25.00% Industrial Alliance National Life National Life 9.03% 8.96% Industrial Alliance Seaboard Life Seaboard Life Pacific 1.85% 1.76% Manulife Financial 14.15% 14.27% Aetna Life Aetna Life Maritime Life Financial Life Financial Life Gerling Global Gerling Global 8.50% 10.26% Sun Life Clarica Metropolitan Life Prudential (UK) Confederation Life Clarica Metropolitan Life Prudential (UK) 23.64% 22.07% Total Exposures % % The contribution columns are based on exposure dollar amounts. Canada Life and Great-West (comprising 39% of the Great-West submission), Desjardins Laurentian Life, 26% of the Manulife submission, Maritime Life, National Life (comprising 10% of the Industrial Alliance submission), and Sun Life (comprising 22% of the Sun Life submission) did not participate in the cause of death study (Table C4 in this report; Table 7 attached). 2

5 The column entitled S.D. provides estimates of the standard deviation of the ratios of actual to expected numbers of deaths. These numbers measure the degree of confidence in the ratios. The formula used to calculate the standard deviations is: S. D. = ( actual number of deaths) expected number of 1 2 deaths Tables C2(a-d): Comparison of total exposures, death claims, average claim, and average exposure with previous studies Table C2a: Total exposures Exposures By Number By Amount ('000,000) Table C2b: Death claims original restated 7,926,542 7,939,327 7,752,412 8,203,667 7,915,419 8,134,305 $576,167 $622,6137 $609,306 $722,610 $741,401 $822,426 Death Claims By Number By Amount ('000) original restated 50,569 50,959 49,238 50,892 48,753 50,421 $1,069,789 $1,158,420 $1,117,241 $1,325,835 $1,315,307 $1,472,456 Table C2c: Average claims Average Claim original restated By Amount $21,155 $22,732 $22,691 $26,052 $26,979 $29,203 Table C2d: Average exposures (sum assured) original restated Males $82,483 $89,168 $89,189 $100,139 $106,708 $115,140 Females $59,731 $64,363 $64,695 $72,609 $77,363 $83,730 Combined $72,688 $78,421 $78,596 $88,084 $93,665 $101,106 3

6 Figure C1: Mortality ratios for policy years through (Source: Table 4) Male & Female Male Female 75 A/E % by Amount Study Years 4

7 Table C3: Comparison of A/E ratios by amount select data only (Source: Table 4A) Known underwriting original restated Male smokers Male non-smokers Unclassified males Female smokers Female non-smokers Unclassified females Unknown underwriting Male smokers Male non-smokers Unclassified males Female smokers Female non-smokers Unclassified females

8 Table C4: Percentage of death claims by amount for the main cause-of-death groupings Cause of Death Accidents and Homicides Heart and Circulatory Malignant Neoplasms Respiratory Suicide AIDS All Other Diseases and Unknown Causes Study Year Policy Years and over 15.1% 13.6% 16.9% 13.2% 18.9% 13.4% 38.2% 35.4% 32.2% 1.2% 1.5% 2.1% 4.7% 4.8% 3.9% 27.6% 25.8% 31.5% 7.5% 7.1% 6.6% 16.7% 17.7% 15.7% 43.1% 38.1% 33.3% 3.8% 4.1% 3.6% 3.7% 4.1% 3.8% 25.2% 28.9% 37.0% 2.6% 3.0% 3.1% 19.6% 25.2% 20.4% 34.8% 32.4% 30.2% 5.9% 5.5% 5.5% 1.8% 2.0% 1.9% 0.1% 0.1% 35.2% 31.9% 38.8% Note: Some companies have sent increasing portions of their data with unknown cause-of-death information. Canada Life, Desjardins Laurentian Life, and Sun Life were not included in the figures above. Canada Life, Desjardins Laurentian Life, Maritime Life, and Sun Life were not included in the figures above. For the study, Canada Life and Great-West (comprising 39% of the Great-West submission), Desjardins Laurentian Life, 26% of the Manulife submission, Maritime Life, National Life (comprising 10% of the Industrial Alliance submission), and Sun Life (comprising 22% of the Sun Life submission) did not participate in the cause of death study. The figures above are based on approximately 62% of the reported deaths. The final row in the above table includes, in addition to unknown causes and all other diseases, the following causes: diabetes mellitus infective and parasitic diseases, tuberculosis, etc. diseases of the digestive system nervous system and mental diseases genitor-urinary diseases, nephritis, etc. 6

9 The following select ratios for smokers and non-smokers were extracted from the study using only data for which the underwriting classifications were known. Comparable ratios from the study are shown. The expected columns are select, smoker and non-smoker distinct. Table C5: Select ratios for smokers and non-smokers Smoking Status A/E % (by amount) Expected death claims ('000) Male smokers $120,426 $130,719 Male non-smokers $477,839 $544,303 Unclassified males $3,219 $3,586 Female Smokers $41,733 $45,080 Female nonsmokers Unclassified females $169,666 $200, $1,849 $2,134 Table C6: Exposures in excess of $1,000,000 included in the,, , and data Exposure # 19,324 25,539 25,827 30,753 Exposure Amount ( 000) $44,169,046 $58,233,228 $58,488,957 $69,524,210 A/E # A/E Amount Data from the Great-West Life portion of Great-West s business are not included in the above table, although the other portions of the Great-West business (London Life, Canada Life, etc.) are included. 7

10 Table C7: Claims in excess of $1,000,000 included in the five years of data in this report Select $ $ $ $ $ # # # # # (millions) (millions) (millions) (millions) (millions) Male Smokers Male Non- Smokers Unclassified Males Female Smokers Female Non Smokers Unclassified Females Ultimate All* TOTAL * For, the Ultimate claims were all Males (two Smokers and seven Non-Smokers). Data from the Great-West Life portion of Great-West s business are not included in the above table, although the other portions of the Great-West business (London Life, Canada Life, etc.) are included. 8

11 Figure C2: Smoker/Non-Smoker select experience (86-92 expected) (Source: Table 4) Male Smoker Male Non-Smoker Female Smoker Female Non-Smoker A/E % by Amount Study Years This report was approved by the Individual Life Subcommittee of the Research Committee. Catherine T. Shum-Adams Marc-André Melançon Lloyd Milani Stephen Beal Marc-André Belzil William Brath Julie A. Chambers François Duguay Mark D. Edwards Emile Elefteriadis (Research Committee Co-Chairperson) (Research Committee Co-Chairperson) (Subcommittee Chairperson) This report was prepared by: Barbara Thomson Statistical Consulting Service University of Toronto November