Snapshot from
This report, compiled by Robyn Lindsay and Tony O’Leary, appears
courtesy of RiskeBusiness, the newsletter of the Australian Life Underwriters
and Claims Association Inc.
29 countries, 292 companies, 381 delegates and no beer (actually there
was beer but it was quite expensive!) The Third International Underwriting
Congress (IUC) took place in
Under the LOMA umbrella the IUC provided delegates with the opportunity
to hear and meet colleagues and key decisions-makers in the global financial
industry to share their views and insights.
Whilst most of the focus was on underwriting, the claims issues were not
ignored nor left untreated. Several of the breakout sessions related to claims
issues. There was something for everyone, whether you worked in underwriting,
claims, product development, pricing, actuarial, forensic accounting, medical
research, risk management, and so on.
With people from so many countries and even more financial services
companies from around the world being represented it was possible to gain an
appreciation of just how wide and diverse the financial services sector is.
Being the first IUC to be held in the Asian region there was a great
deal of attention on the emerging and new markets, and the challenges that they
are facing. Issues of tied agency, agent/advisors domination and shortages of
skilled staff were raised along with hepatitis B. Whilst Hep B is not of major
concern in some Western markets it is of major concern in Asia, where in some
countries a large majority of the community are infected, often at birth.
Opening Address
The opening keynote address was given by Victor Apps, (Executive Vice
President, Manulife Financial,
Manulife are very active across the region and Mr. Apps presented a
broad vision of the Asian life insurance industry, as it is today and as will
evolve in the years ahead. He described the areas such as
An Educational Recognition Ceremony was held to honor people who
had achieved the designation of Fellow of the
Maeve Buultjens, AMP, Sydney
Mike Culhana, Manulife,
Debra Jeon, ACL, Sydney
Miriam Krajewski, BT Financial Group, Sydney
Ann Law, Swiss Re, Hong Kong
Robyn Lindsay, UniSuper,
Congratulations to all our new FALUs!
The Panel Discussion “Inside Asia” followed, where the panelists spoke
about wide range of issues related to the insurance markets, product
distribution and risk management throughout
The panelists were:
Joe Dahl, Vice President of Underwriting, Sun Life Assurance Co of
Geoff Baars, Managing Director, NMG Financial Services Consulting,
Geoff Coley, Director, Risk Profile Internationa,l
John McKeand, Managing Director, INSINC Limited, Hong Kong
Issues discussed included the traditional low productivity from the
advisors; difficulty in getting skilled underwriters; the opportunities
available due to the underselling of protection products; in particular Income
Protection; focus on Critical Illness and Juvenile insurance; different
mortality issues facing the Asian market, in particular Hepatitis B; the
diverse markets and mortality experience from one country to the next; and the
challenges of getting reliable evidence (if in fact you can get any health
evidence); a general reluctance of clients to disclose their true financial
status to insurers; and the widely used tax minimization schemes.
It all sounded like a huge challenge and an endless supply of opportunities
for growth, whilst grappling with the pricing, product development,
underwriting and claims management issues, across many countries with different
languages, cultures and religions.
On Monday afternoon the various concurrent or breakout sessions
commenced. Through the next 2 and a half days numerous concurrent sessions or
workshops were conducted and in some cases repeated to allow as many people as
possible to attend the sessions that interested them most.
Unfortunately your RiskeBusiness reporters could only cover a small
selection of the interesting concurrent sessions. Where we were unable to
attend a session we have attempted to provide a background from the IUC session
material as to the content of the session. However, it is possible to see the
slides for most of the presentations on LOMA’s website at www.loma.org/iuc.asp
<http://www.loma.org>
Disability Insurance
John Ryan, Regional Manager, Munich Re, Australia
Tassin Barnard, Managing Director, Financial Protection, AXA Australia,
Australia
John walked us through the evolution of the Disability product since the
late 1960's and the move from the traditional products that we sold via
professional association to professionals, i.e. doctors, lawyers etc through
the development of the guaranteed renewable products available through life
agents to much wider occupation groups, followed by the deteriorating results
and claim reserves forcing companies to take remedial action by revised
pricing, definitions and the move back to indemnity from agreed value.
Tassin presented a case study about the rivalry of ACL and NMLA/AXA in
the Disability business over the years, despite both being owned by the same
parent company. After hearing about the major “inhouse” competition and
challenges facing both companies and the restructuring undertaken in respect of
pricing, product design, underwriting and claims we heard about the significant
improvements made over the last 2-3 years.
Tassin stressed the need to manage the numbers and being careful about
what you don't see and the need to look at your own companies business and know
the problems.
21st Century Underwriting
The two sessions on 21st Century Underwriting covered the emergence of
"preferred risk" underwriting: what, why and how? and were presented
by:
Rick Bergstrom, Consulting Actuary, Milliman USA, USA
Anna Hart USA
Guizhou Hu Vice President, BioSignia, Inc, USA
Michael Benton, CEO, MedicalsDirect, UK
Mary Fernald, Sr Vice President, Underwriting & Administration, Scottish
Re, USA
Much of the discussion in this session was around the issues in Preferred
Risk underwriting and involved the presentation of various actuarial modeling
techniques which would enable more accurate calculation of the discounts that
should be given to preferred lives. There was also some discussion on the use
of technology in underwriting and the outsourcing of the underwriting
assessment process. The question of identity theft, which is potentially a
major problem in North America and other parts of the world, was also discussed
in some depth.
Critical Illness Insurance
Critical Illness was also addressed in two sessions covering:
Product Trends presented by Tony O’Leary, Risk & Strategy Management Consultant,
Australia and
Peter Temple, Deputy Managing Director, GeneralCologne Re, Sth Africa.
The focus in this session was
wide-ranging and included information on the latest product development in
Crisis Cover such as female plans, buyback cover, second event cover,
guaranteed acceptance and ancillary services. The speakers also discussed the
implications of the race to cover more conditions, with the latest count being
around 55. There was also focus on the effect of recent medical developments on
experience and the question of providing rate guarantees.
Underwriting and Claims Experience
presented by Susie Cour-Palais, International Risk Consultant, SCP
International Risk Consultants, UK and Wolfgang Droste, Chief Executive,
GeneralCologne Re, Hong Kong.
The speakers addressed the issues of the changing experience in critical
illness, non-disclosure (particularly of smoking habits), the affect of medical
developments on experience and presented some ideas on how the approach to
underwriting should change to deal with some of these issues.
Genetics and Insurance
J. Alexander (Sandy) Lowden, (Medical Director, LabOne, USA and Achim
Regenauer, Chief Medical Officer, Munich Re, Germany
Sandy examined whether Genetic Testing has a future in underwriting and
looked back over the last decade where despite the hype we are no closer to
having simple screening tests that help identify risk for reasons including:
there are too many genes
there are many mutations
not cost effective
no actuarial verification.
He also explored various issues around the currently topical BRCA genes
and Heamochromatosis.
Sandy raised the issues that Genetic screening won't work as most
diseases are multifactorial, and complex gene/environmental issues make
actuarial predictions difficult. He suggested that one approach to mitigating
risk could be where we encourage clients
to know their own genetic risks. Clients would then be able to benefit from
prevention and insurers would benefit from better mortality.
However, care should be taken to ensure that we are not seen to be
insisting on genetic testing in the risk assessment process.
In summary Sandy felt that Genetic screening will not meet actuarial
rules for general testing for the decade; people who know their risks can
mitigate outcomes; and there may in the future be good genetic-derived tests to
classify risk in post-disease underwriting.
Achim focus on the effects of Genetic Testing on life and health insurance
and commenced by saying that there are no permanent and systematic
documentation and there are concerns about the quality of genetic testing for
monogenic disorders.
When discussing Genetic testing for complex disorders it was felt that
at present genetic testing is not feasible; and whilst monogenic diseases may
help elucidate complex disease, the future is currently not predictable and the
expectation is that within the next 5 years there will be no impact on the
insurance industry.
Laboratory Testing
J. Alexander (Sandy) Lowden, (Medical Director, LabOne, USA presented Blood
testing, while Hank George, President Hank George, Inc USA presented Oral
Fluid testing.
We heard about the expanding role of laboratory testing in insurance
underwriting, with special focus on the emergence of oral fluid screening.
Sandy walked us through why we do lab testing; quality controls around
the testing; importance of sensitivity and specificity of the test; what is
normal ; and looking at the test results.
He stressed lab tests are designed to help us make decisions, they are
not the decision.
In summary Lab tests as only as good as the applicant, the collection,
the lab and the use of the information and they will only tell you what you
asked; and should only be used as and underwriting guide.
Hank gave a brief history of Insurance Laboratory testing in North
America from the mid 1980's where it was dominated by urine and blood samples
for large sums insured only; through the advent of the HIV testing where
testing became the norm at lower levels; the 1990 to 2003 which saw the proven
protective value triggering widespread use; and from the late 1990's to today
the approval and increase of oral fluid test to screen for and confirm HIV-1.
Hank explained the Oral Fluid collected for insurance testing in NOT
saliva (saliva comes from salivary glands). Oral fluid is "mucosal transudate"
which derives directly from blood, and contains Proteins, Antibodies and drug
metabolites.
Oral fluid can be used for the following insurance-relevant tests:
HIV-1 (screening and confirmation)
Cotinine (nicotine's primary metabolite)
Hepatitis C antibodies (outside USA)
Oral fluid is essentially as reliable as contemporary blood testing.
Cotinine testing is widely used in North America because:
smoker/non-smoker pricing makes it essential to distinguish from those
who smoke and those who don't;
higher prevalence of non disclosure in this areas compared with other
aspects of risk assessment; and
cotinine has very high sensitivity and exceptional specificity for tobacco
products and nicotine products used to aid in giving up tobacco consumption.
Cocaine testing is performed by most North American insures as cocaine
is a marker for Risk taking behaviours.
The advantages of oral testing in Hep C antibodies include:
HCV infection is a leading cause of mortality and morbidity worldwide
HCV antibody testing is highly reliable
over 80% of individuals with HCV antibodies are found to be currently
infected with this virus.
In summary Oral fluid is highly reliable; it plays a major role in preventing
significant aspects of non-disclosure; and the potential to expand its use, in
lieu of blood testing, is now on the "radar screen" on risk managers.
Hepatitis B and C
Kevin Somerville, Divisional Medical Consultant, Swiss Re, UK presented Hep
B, while Wolfgang Munda, Medical Director, Generali, Austria presented Hep
C.
Information was provided on the latest mortality and morbidity issues in
chronic Hep B and Hep C infection.
Kevin told us that there are 2 billion people worldwide with current or
past infection of HBV, and there are 4 million new acute infections per annum.
Different forms of Hepatitis can be predicated by where you live. HBV is mostly
likely South East Asia, while HDV is predicted in India.
HBV modes of infection are in the West due to multiple sexual partners;
health care workers, while in other areas it is primarily due to perinatal
infection.
Patterns of infection can be influenced by vaccination of newborns. A
study in Taiwan after the introduction of vaccination of newborns was
introduced in 1985 has shown a dramatic change in experience.
The mode of transmission either in adults or perinatally appears to be
more important to the risk that the Genotype.
When assessing the risk it is necessary to consider if there is:
viral replication
chronic inflammation of the liver
any fibrosis or cirrhosis
Kevin explained that males do worse than females with HBV and strongly
recommends getting hold of the liver biopsy report (if there is one).
Wolfgang provided an overview of the facts and figures, including a
broad global prevalence of HCV, and explained that 75% of infections become
chronic and the chronicity increases with age. The individual course of the
disease is variable and unpredictable and 50% of cirrhoses are referred for
transplantation.
HCV can usually has unspecific symptoms of nausea, abdominal pain and
fatigue, and ALT can be normal to elevated. Specific findings include
antibodies, and PCR (viral load)
Known risks factors for HCV are drug abuse, blood transfusion before
1990, living in areas without universal precautions, nosocomial transmission
and low socioeconomic status.
When underwriting applications from people with HCV the underwriter
needs details of latest liver biopsy, to know out come of treatment and if not
treated why not, serial liver enzyme testing, an co-morbidity factors and
current alcohol use.
HCV patients can be categorized into those with good prospects, through
to very bad depending on their treatment; liver enzyme levels, tissue damage,
extent of disease, no co-infection, abstaining from alcohol etc.
Looking into the future for insurance medicine Wolfgang felt there was a
better prognosis with lower mortality and morbidity, better prognostic
indicators; more reliable data, possibility of a "tailored approach"
to decision making.
Liver and Breast Cancer
Presented by Bob Pokorski, Vice President of Worldwide Medical Research &
Development, GeneralCologne Re, USA and Robert Rubens, Chief Medical Officer,
Swiss Re, UK
We learnt the latest on mortality and morbidity aspects of liver and
breast malignancies.
Bob focused on Underwriting Hepatocellular Carcinoma in Asia where there
is a high incidence of HCC. The types of primary liver cancer are:
HCC (which makes up 85 to 90% of primary liver cancer)
Cholangiocarcinoma
Hepatoblastoma
Angiosarcoma
HCC is the number 5 cause of death worldwide with 33% of the deaths
coming from China and another 33% coming from the rest of Asia.
HCC is the number 4 cause of cancer death worldwide and the second cause
of death in China over 300000 deaths in year.
Needless to say HCC has the highest incidence on South East Asia and
sub-Saharan Africa, while the lowest incidence in South America/Australia/New
Zealand.
The male rate of HCC incidence is 2-4 times higher than females. With
males suffering more cirrhosis and continuing to use alcohol and tobacco.
In northern Thailand there is a liver fluke that is responsible for a significant
amount infection.
From 1978 to 1992 there has been significant changes in primary liver
cancer incidence due to a decrease in HBV/aflatoxin, and a higher incidence due
to increase in HCV.
The incidence of primary liver cancer can vary by ethnic group in a
single country, i.e. New Zealand in the non Maori and Maori; Singapore the
Indian, Malay and Chinese groups and in the USA, the white, black, Japanese,
Hispanic, Filipino, Chinese and Korean.
Bob told us about the factors associated with poor survival including
severe co-existing cirrhosis (being the most important) through to the site of
the tumor, if multiple tumors, symptoms etc. And despite many types of
treatment being available 50% of HCC patients die within the first year of
diagnosis. This is thought to be due to the fact that most HCC's are well
advanced before they are detected.
It was suggested that when underwriting applicants with a history of HCC
we postpone for 5 years after most recent treatment and recognize that the main
risk factor after the 5-year survival is cirrhosis.
Professor Rubens explained that when looking at breast cancer it is
necessary to focus on family history and risk of cancer; benign breast
disorders; impact on prophylactic mastectomy in women at high risk; prognostic
factors in breast cancer; and the impact of adjuvant systemic treatment on
mortality.
He provide data on relative risks of breast cancers with particular focus
on
age in BRCA1 mutation carriers;
those with a family history
women with non proliferative and proliferative breast disease
Poorly- defined benign breast conditions include Fibrocystic disease,
Benign breast disease and Mammary dysplasia - all conditions which are
characterized by pain and lumpiness in an otherwise physiological normal
breast.
An algorithm for underwriting Critical Illness applications with a history
of breast lumps has been developed with terms ranging from standard through to
decline.
HIV/AIDS and SARS
Rene Geyer, Medical Assistant, Life Underwriting, Hannover Life Re, Sth
Africa presented on HIV/AIDS, and Nick Perkins, Vice President, AIG Life, Hong
Kong presented on SARS
We learnt about the changing face of the AIDS pandemic; with special
focus on southern African and Asia and the outbreak of SARS in Asia. The data
presented on AIDS and HIV infection showed how much more was understood about
the degree of spread in Africa and how both public education and treatment were
helping to bring things more under control. However, cost of treatment would be
a major stumbling block in this respect. More worrying are the so called “new
wave countries” which include Russia, India and China where the epidemic is
growing rapidly and there is some concern over the accuracy of the available
figures. The SARS presentation was an interesting overview both from an
insurance and a personal perspective and concluded that the impact on the
industry was minimal.
Issues in Marketing and Distribution
Peter Le Beau CEO, Lebeauvisage, UK, and Geoff Coley, Director, Risk
Profile International Australia
Examination of risk management in the context of prevailing marketing
and distribution practices in life insurance. The speakers presented an
overview of some of the issues in market segmentation in the UK and how this
can impact on mortality and the interaction between the marketing approach and
the underwriting discipline. A separate view was given on distribution in Asia
and how this may change the face of the market in the future and its influence
on underwriting practices and procedures.
Alternative Distribution issues and Underwriting
Brian Home, Director, Risk Profile International, and Andre Hermanns,
Director & Principal Consultant, NMG, New Zealand
The presentations in this session focused on the concept that sole
distribution through agents was a thing of the past and that successful
companies will have multidistribution channels which will include some of the
so called alternative distribution channels. These channels will include worksite
marketing, bancassurance, affinity marketing and direct marketing. Underwriting
will have to change to facilitate these channels rather than obstruct them as
it can do at present. The underwriting approach will encompass traditional
underwriting, teleunderwriting and the use of rule based and expert
systems.
The Underwriter as a Business Person
Ron Colligan, Principal, Guy Carpenter, USA and Tony O'Leary, Risk and
Strategy Management Consultant, Australia
This was a detailed discussion on how the underwriters’ role has changed
over the years and how the 21st Century underwriter has to develop
his/her career to become the consummate business person. The presentations
looked at the insurance company Balance Sheet and how this might be affected by
the underwriter as well as what the underwriter might have to do to preserve
and develop the underwriting role as we move into the future.
The Theory and Practice of Teleunderwriting
Tom Bienvenu, Executive Vice President, Canadian & Int'l Operations,
LabOne, Inc. USA and Jonathan Crumiller, Chief Operating Officer, Princeton
Consultants, USA
This relatively new approach to underwriting has been piloted in Australia
and is becoming more common in the USA. The presentations identified that when
performed correctly there are benefits in the process for the applicant, the
agent, the underwriter and the reinsurer.
An Inside Look at E-Commerce
Moderator-Dave Rosier, Vice President of Risk Management for Asia,
Manulife Financial, Hong Kong.
Panelists:
Robert Littell; Principal, Littell Consulting Services, USA
Jean Gora, Manager of Research, LOMA, USA
Les Cantlay, Monevate Ltd., UK
The panelists examined the strategic innovations in the use of technology
and e-commerce in administration, marketing, underwriting and related
functions. The message was that E-commerce can and will impact on all areas of
the insurance value chain with the key being the customer. Once the legal
issues surrounding electronic signatures have been resolved the feeling was
that doing business electronically will become more and more attractive.
However the whole process of the sale of a Life policy needs to be rethought.
Initially E-commerce will not do away with Agents but will improve the
efficiency of the whole process. Ultimately more will be able to be done direct
between the insurer and the proposer.
Health Insurance
Horst Weber, Deputy Member of the Executive Management, Munich Re,
Germany and Andrew Scott,
Manager-Technical Sales, Discovery Health, Sth Africa
The presenters discussed the advantages for both the proposer and the
insurer of full underwriting when compared to the traditional pre-existing
exclusions approach traditionally used in Health Insurance. Some arguments were
put forward for the use of rule-based and expert systems in this area compared
to underwriting manuals.
Juvenile Insurance
Dewi Arifin, Chief Underwriter, Munich Re, Singapore and Mick Jones,
Head of Risk Management, Hong Kong & Macao, Swiss Re, Hong Kong
Dewi focused on the demographics, practical medical aspects and
underwriting considerations, some common illnesses (congenial and
hereditary/genetic diseases; cancers, injury and obesity) and underwriting
acceptance.
In 2000 the major causes of death among children under five, worldwide were:
Perinatal 23%
Acute respiratory infections 19%
Diarrhea 13%
Malaria 9%
Measles 5%
HIV 3%
Others 28%
Overriding this 54% of all deaths were associated with malnutrition
Drawing on a 1999 World Health Organization report Dewi explained that
the pattern of disease and disability among children in developing countries
was:
Children aged 0-4 years - mostly infections, perinatal and nutritional
disorders (80%)
Children aged 5-14 years- infectious, perinatal & nutritional
disorders; non- communicable disease and injury (33% each).
When underwriting Juvenile Insurance it is necessary to apply equal
significance to non-medical factors and to adopt a different approach from
underwriting adult lives.
Characteristics of medical Juvenile Insurance medical underwriting are:
recognizing that child development is the number one factor;
the limited medical evidence, including differential diagnosis;
harder to medical examine children; and
lack of statistical data
Congenital and hereditary/genetic diseases of high importance are:
B-thalassemia which has a high prevalence throughout South East Asia and
the Indian subcontinent; and
Congenital heart disease with about 70% being diagnosed before age 1.
VSD is the most common acyanotic group and Tetralogy of Fallot being the most
common cyanotic group.
When underwriting, minor impairments maybe acceptable but the more
complex impairments with high loadings are speculative. Prudent to postpone if
diagnosis/prognosis is unclear.
In summary:
Juvenile life Insurance underwriting is difficult and Critical Illness/TPD/
Accident benefit is a challenge;
medical underwriting is very important;
immature portfolios and lack of experience and statistical data
careful underwriting approach needed.
Mick started his presentation by posing a questions "Should be we
insuring our children" and again highlighted that there are different
issues facing life insurers, underwriters, product development etc in the Asian
markets compared to our Australian/New Zealand markets.
Juvenile Insurance is considered for reasons including:
healthcare
regular savings to provide for the future,
education; and
protection.
The sales pitch is relatively easy with Juvenile Insurance in that it:
is easy to qualify
assures affordable protection
cheap rates
guaranteed insurability,
funeral costs covered
However reasons against Juvenile Insurance include:
lack of insurable interest;
putting the child's life at risk; and
primary aim of insurance is to protect the income of the breadwinner.
Legally there are few legislative restrictions on Juvenile Insurance
across Asia. However there is the moral risk and it is paramount to financially
underwrite.
Unlike in Western countries Asian children are expected to contribute to
the financial well being of their parents.
Mick explained the need to understand and know the relevant market when
deciding on Juvenile Insurance. Juvenile Insurance is available across the
traditional product types including Whole of Life, Term Insurance, Critical
Illness, Accidental Death and TPD each with their own issues and often
utilizing the adult style definitions.
The applications must be underwritten with thorough attention to the
financial situation of the parents and it is preferred that at least one of the
parents also has insurance. Suggestions that the sum insured under the Juvenile
Insurance be a % of the adult cover and that all siblings are insured would
help overcome some of the moral unease attached when promoting and underwriting
applications.
In summary Mick suggested that it was too early to tell what the Juvenile
Insurance experience has been, although anecdotally it appears to be excellent
without many dubious or fraudulent claims.
Financial Underwriting
David Laskey, General Manager-Asia, Hannover Re, Hong Kong and Wayne
Macedo, Vice President and Chief Underwriter, Transamerica Re, USA.
The speakers considered the growing role of financial underwriting
analysis in the Asian market and the difficulties facing underwriters and
claims departments with the reluctance to disclose the actual financial
situation and the numerous tax minimizations schemes. The agents’ role in the
financial underwriting process was considered and how it can be used as an aid
to more quality sales as well as part of the underwriting process.
Fraud Risk Management
John Saunders, Manager, Linden Management, UK and Tina Paap, Claims
Manager, RGA Re, Australia
John and Tina allowed us to discover the latest on insurance fraud and
measures taken to counteract this growing problem.
John told us about his experiences as a private investigator based in
the UK and trips into the African continent to investigate mysterious deaths,
and occasionally deaths and funerals when in fact no death had occurred.
Regrettably the majority of the claims investigated come from developing
countries and involve corruption, violence, fake deaths, poverty, drugs and
fake documents which are easily obtainable.
These types of frauds are often committed by people in financial difficulties;
domestic, health and residence problems and criminals.
Tina shared with us an awareness fraud, the definition of fraud, and
opportunities for fraud whilst posing the questions of where do we draw the
line with fraud. Is claimant who extends their DI claim beyond the true
disablement period guilty of fraud? Is the TPD claimant who pursues their claim
despite knowing their is a large element of choice in the action they take
guilty of fraud? Interesting questions and ones that no doubt regularly come
across the desk of Claims staff.
In preparing material for her presentation Tina found a wide range of
fraud (how to defraud) information by doing some simple searches on the web.
Workshops
During the IUC delegates could attend 1 of 3 discussion/interactive
workshops:
1. The Right to Underwrite
Moderator-Petar Peric, Manager, Underwriting and Product Advisory
Services, GeneralCologne Re, Australia
Panelists:
Andre Chuffart (Senior Management, Swiss Re, Switzerland
Robert Young, Consultant Physician & Senior Lecturer, University of
Auckland, New Zealand
This forum addressed the very topical issues of the right to underwrite
and how it was being attacked around the globe. We were given a very
interesting overview of the situation in Europe including potential European
Union legislation which would prevent the use of gender in pricing. This also
included a discussion on how privacy laws are leaning less towards relevance of
questions and more towards their proportionality which effectively means that
we may only be allowed to underwrite the larger sum assured policies but not
the smaller ones. We were also provided with an interesting and detailed view
of the practical implications of The Human Rights Act in New Zealand and how
its practical application was changing through a new complaints process.
2. Claims Workshops
Tony Frommel, Manager, Operational Division: Life, Munich Re, Germany
and Jeff King, Managing Director, Riskman GmbH, Switzerland
Tony and Jeff provided an overview and some examples of hard and soft/or
opportunity, fraud experienced in various world markets.
They presented several case studies including:
a death claim in mainland China, with non disclosure and the difficulties
in obtaining any medical evidence and the role of a middleman in between the insured
and agent in completing the business and the complications that bought to
unraveling information at claims stage;
a Critical Illness claim in Taiwan were it was necessary to determine if
the insured had suffered a Heart Attack in accordance with the definition, a
confusing non disclosed family history regarding heart problems, and demands
the agent (who is related to the insured) for the claim to be paid.
an Australian court case surrounding a Critical Illness claim and the
Heart Attack definition.
and posed various questions for each scenario to determine what the
audience would have done with the available evidence.
3. Long Term Care
Moderator-Robert Littell, Littell Consulting Services, Altlanta, USA
Panelists:
Lucie Taleyson, Head of Research & Development Centre, SCOR Re,
France
John Evans, Associate Medical Director, SCOR Re, France
Closing Keynote Address
The closing keynote address was given by John Tiller, Senior VP Research
& Development, ERC Group, USA presented the keynote address on
"Considerations for a Changing World"
Recognizing the dramatic change in the life insurance industry due to
restructuring, complex regulations, international expansion, new products and
competitors, John shared his perspectives on the future of worldwide life and
health insurance.
John sees the business issues in our changing world to be Concentration
of risk by geography, by risk and by product; Consolidation effects on the
primary company and the reinsurer; and increases in IT investment; Digitization
which will drive economies of scale and establish cost advantages, and enable
data-driven decision, while providing 24/7 research and training capabilities;
Globalization including operational efficiencies to be gained by work being
performed in low cost regions (e.g. India and Mexico), and enabled by
digitization and process control. Globalization of course needs to be measured
against local balance and Regulation.
Risk Management is greater than just prudent reserving and conservative
underwriting and utilizing strong processes that use timely and accurate data
that is then turned into useful information.
John saw information being the driver and expense lever for the 21st
century and recognized that the reinsurers, due to their consolidation into fewer
companies and few main players, would no longer be the source of cheap capital
for the life offices.
And an underlying theme that Knowledge and Expertise = the Keys to
Success.
Closing Session
The 3rd IUC was bought to a close with announcement of the venue and
dates of the next 2005.
The 4th International Underwriting Congress will be on the 17 to 20
April 2005 to be held in Geneva, Switzerland
The 4th IUC planning committee have already met and things are well
underway for what promises to be another exciting IUC.
Delegates enjoyed a closing party complete with a buffet of Chinese and
Indian foods and several local dance performances. Delegates also made the most
of the last opportunity to catch up with old friends and meet new ones.
Finally the IUC came to a close and delegates prepared to return home,
with many taking advantage of the proximity to exotic holiday destinations to
take in some needed some rest and relaxation.
Overall
The IUC provided excellent opportunities for delegates to learn about
issues impacting our industry worldwide and with a particular focus on the
emerging Asian markets.
The various sessions and keynote addresses highlighted the various
changes which have impacted us in the past, are with us today and which will
influence us in going forward.
The need to know one’s business and the market in which one operates
remains paramount, along with the need to embrace technology to allow us to
maximize our full potential and deliver shareholder return.
The IUC highlighted the many differences in products; medical conditions
and access to readily available and affordable treatments; the availability of
medical and financial evidence on which to based informed underwriting and
claim decisions; the need for more and more statistical data on which to make
and base decisions to allow us to effectively and efficiently manage our
business and risks.
The dominance of the advisors force, whether tied agencies or not; and
the lack of skilled underwriting (and claims) resources remain problematic for
all markets; coupled with rationalizations and reduced resources amongst the
reinsurers.
A copy of the slides of the various presentations has been posted on the
LOMA website and we encourage you to visit the website and view/download the
areas that are of particular interest to yourself. This report, whilst lengthy,
is really only a snap shot of what was a very full program.
Robyn Lindsay is Claims Manager, UniSuper,
Melbourne, Australia (robyn.lindsay@unisuper.com.au) and Tony O'Leary is a Risk
and Strategy Management Consultant, Sydney, Australia (toleary1@bigpond.net.au)