[Principles of risk assessment in the life insurance industry as exemplified by ulcerative colitis]

This report addresses physicians whose work lies outside the field of life insurance and especially its particular type of risk assessment. It attempts to clear up some typical misconceptions arising between attending physicians and the medical consultant working in life insurance. Taking as an example the life insurance application of a man with conservatively treated ulcerative colitis, risk assessment procedure from the viewpoint of life insurance is analyzed on the basis of the Swiss Reinsurance Company rating guidelines. Attention is drawn to the specific features of prognosis assessment in life insurance compared with that in medical practice or at the bedside. The concepts of mortality and extra mortality are defined and that of mortality compared with the concept of survival rate. The example of the colitis patient is used to show why the extra mortality observed by life insurers can be markedly above that indicated by epidemiologists and clinicians, and why a practically normal 5-year survival rate and significantly increased mortality need not be mutually exclusive. The statistical basis for the mortality assumptions of life insurers is exemplified by the Medical Impairment Study 1983 published in autumn 1987, which gives an average extra mortality of 162% for insured persons who had ulcerative colitis at the time of policy issue.