The Investment and Financial Services Association (IFSA) and KPMG Actuaries have conducted the largest Australian life insurance claims experience investigation, with the release of the findings being used to update the Australian Insured Life Table.
As part of the study, KPMG analysed over eight million lives insured and more than 16,000 claims during 2004-2006 from 14 life insurance companies.
The research provided a valuable of source information for pricing, reserving and managing insurance risk for all Australians, according to KPMG Actuaries director Hoa Bui.
“Its special significance is that the industry now has four years of high quality data that can be used to update the Australian Insured Life Table,” he said.
“The Australian Prudential Regulation Authority uses the Insured Life Table as a benchmark for setting capital requirements for insurance companies operating in Australia.”
While the industry will soon be in a position to update the Insured Life table for mortality, with the last table produced in respect of claims experience covering 1995-1997, the new data may also provide sufficient information for the production of an inaugural Insured Total and Permanent Disability Table as well as an Insured Trauma Table.
IFSA chief executive John Brogden said the analysis was of vital importance particularly in terms of capital adequacy and international benchmarking.
“Such a large sample size allows us to learn a lot about the health, wellbeing and longevity of the insured Australian population over time and helps our members to design and offer products that are more affordable and better tailored to their family and wealth protection requirements,” he said.
