"Everything in moderation…" Fergus Bescoby takes a look at the use of alcohol and recreational drugs in insurer's terms
Alcohol and drugs have made regular headline news recently and as you would expect, never for the right reasons. Some 2500 years ago Socrates quoted "Everything in moderation, nothing in excess". With this in mind, there are various implications for insurance companies of clients not heeding Socrates warning.
Alcohol Abuse
There are numerous illnesses related to alcohol abuse and depending on the extent and severity of the illness, some may be insurable and others not. It is up to the underwriter to determine the extent of the risk and offer terms accordingly.
Signs and symptoms include repeated infections (i.e. pneumonia), clotting disorders and unexplained irregular heartbeats. Other findings can include pancreatitis, unexplained hepatitis, cirrhosis (progressive loss of liver function), peripheral neuropathy and brain damage including ataxia and seizures.
In addition to the above, other complications are cardiac damage, hallucinations after excessive drinking, impotence, delirium tremens, foetal alcohol syndrome and Vitamin B deficiency.
Treatment consists of various medications, psychotherapy, vitamin supplementation, adequate nutrition and rest which hopefully lead to withdrawal and abstinence from alcohol. It involves a social-medical approach of detoxification and medical evaluation and monitoring along with group, individual and family therapy. The success of treatment for alcoholism ultimately depends on the individual's motivation, willingness, and relapse plan participation.
Two different types of medications are commonly used to treat alcoholism.
The first are tranquilizers called benzodiazepines (e.g., Valium, Librium), which are used only during the first few days of treatment to help patients safely withdraw from alcohol.
A second type of medication is used to help people remain sober. A medicine for this purpose is naltrexone (ReVia). When used together with counselling, this medication lessens the craving for alcohol in many people and helps prevent a return to heavy drinking.
Another older medication is disulfiram (Antabuse), which discourages drinking by causing nausea, vomiting, and other unpleasant physical reactions when alcohol is used. This can be in the form or oral medication or implants.
Prognosis depends on the duration of the disease, success and compliance of treatment and the degree of organ damage. A high relapse rate coupled with an increased incidence of accidents and suicide attempts does not help. Should the alcoholic continue to drink, the life span can potentially be shortened by an average of 15 years.
From an underwriting perspective
The prognosis depends on the classification of alcohol use:
1. Alcohol misuse
It is only possible to detect alcohol misuse by information obtained regarding the clients personal history, for example past driving convictions, advice by a doctor to reduce alcohol, loss of license or accident. Self reported daily or weekly excessive alcohol consumption or a history of elevated liver function tests will also assist the underwriter in obtaining a clearer picture.
2. Alcohol dependency
There are several definitions of alcoholism, one of them being ‘a psychiatric diagnosis describing an entity in which an individual uses alcohol despite significant areas of dysfunction, evidence of physical dependence, and/or related hardship'.
The disclosure of alcoholism and resultant treatment is obviously a serious concern.
3. Organ damage or impairment
All organ damage or impairments of organs, such as the liver, heart, pancreas or the central nervous system have to be considered separately and incorporated into the final loading.
Alcohol consumption, both past and present is obviously a major consideration for the underwriter. This, coupled with any underlying organ damage, or other medical symptoms need to be taken into account when assessing these risks. As a general guide, alcohol consumption is normally classified in one of the following categories and life cover will be rated accordingly:
A history of excessive use will be rated based on the number of years since last consumption along with any current medical conditions.
Terms for IPC, TPD and SIC/CIC will be considered on an individual basis but will generally be more severe than for the life risk.
Recreational Drugs
It is estimated that 200 million people across the world use drugs at least once a year, of which half use them at least once a month. Feted in our popular literature, music and culture but reviled by the Church, schools, parents and law enforcers - Recreational Drugs are everywhere.
Defined loosely as drugs used for enjoyment rather than for work, medical or spiritual purposes, Recreational Drugs also include alcohol and tobacco.
The term, however, is not used for the use of drugs for utilitarian purposes, such as the relief of fatigue or insomnia, or the control of appetite, or for performance enhancement. Recreational Drugs are basically used for pleasure, and therein lies their attraction.
Their effects on the body and mind are varied, but unfortunately, never very good. A drug that makes you feel good, and is good for your health too, just does not exist.
Drugs are responsible for between 1,300 and 1,400 deaths a year in Britain. But they also wreck thousands of relationships, families, and careers. All this is an added burden to the NHS.
It is estimated that the social end economic cost of drug abuse to the UK economy in terms of crime, absenteeism and sickness is in excess of £20 billion a year.
According to the 2007/08 British Crime Survey, the five most commonly used drugs in Britain are:
Cannabis: This contains about 400 chemicals, some of them carcinogenic and is a mind altering drug that can change how the brain works.
The survey found that 7.4% of 16 to 59-year-olds reported using cannabis in the last year.
There's evidence of a link between cannabis and mental health problems, such as schizophrenia. Research has shown that smoking cannabis joints is even more damaging to lungs than smoking cigarettes. Long-term use can cause lung disease and cancer. Cannabis use can also cause lack of motivation, paranoia and memory loss.
Cocaine: A powerfully addictive stimulant drug, the powdered form is either snorted or injected. Crack cocaine is cocaine that comes in a rock or crystal that is heated and smoked.
This is the second most commonly used drug, with 2.3% of respondents admitting to having taken cocaine in 2006/07. Cocaine is highly addictive. People who are young and healthy can have a fit or heart attack after taking too much. It can also cause panic attacks.
Ecstasy: A man-made drug that is chemically similar to both stimulants and hallucinogens. It is usually taken orally as a capsule or tablet. The study revealed that 1.5% of 16 to 59-year-olds had taken ecstasy in the last year, although its use is decreasing. Ecstasy can cause panic attacks or psychotic states. There have been over 200 ecstasy-related deaths in the UK since 1996 and ecstasy has been linked to liver, kidney and heart problems.
Hallucinogens: A strong mood-changing drug with unpredictable psychological effects. The report found that 1.4% of participants had used hallucinogens, which are Class A drugs. Even possession can carry up to seven years in prison. The side-effects, which are random and occasionally very frightening, may include flashbacks.
Amphetamines: A psycho stimulant known to produce increased wakefulness and focus in association with decreased fatigue and appetite. In the UK they are regarded as a class B drug.
The maximum penalty for unauthorised possession is five years in prison. Amphetamine use was recorded among 1% of 16 to 59-year-olds. The number of people dealt with for offences involving amphetamines, has dropped dramatically in the past five years. Amphetamines are very addictive and the comedown can make you feel ill and depressed. They put a strain on your heart and users have died from overdosing.
Signs and symptoms
Depending on the actual compound, drug misuse can lead to health problems, social problems, morbidity, injuries, unprotected sex, violence, death, motor vehicle accidents, homicides, suicides, mortality and physical dependence or psychological addiction.
Treatment
Medication and behavioural therapy, especially when combined, are important elements of an overall therapeutic process that often begins with detoxification, followed by treatment and relapse prevention. Residential treatment can be effective for those with more severe problems.
Prognosis
Sadly between 40 to 60% of drug addicted patients suffer a relapse.
From an underwriting perspective
Similarly to alcohol misuse, the underwriter will only really become aware of drug use by information obtained regarding the client's personal history. A client may admit past or present usage or it may be mentioned on a GP report. A drug screening test and/or an HIV test may be required in certain instances. Very often a history of drug use in a now healthy and stable person can be disregarded after a certain period of abstinence. The underwriter would need to know what drugs were being taken, when they were last taken and whether the person is now leading a relatively stable life (working, married, healthy etc). Depending on the information obtained, terms may be offered.
The actual decision will depend on the type of drug or drugs that were being used.
The occasional use of cannabis for example can generally be accepted at Std rates for life cover; however, heavier regular use will attract a loading.
Drugs like cocaine and ecstasy will be looked at in a far more serious light and terms will not be offered while they are still being used. Terms may be offered after a period of abstinence.
Terms for IPC, TPD and SIC/CIC will be considered on an individual basis but will generally be more severe than for the life risk.
Fergus Bescoby is underwriting development manager at PruProtect
