Alan Lakey: The complexity of valuing critical illness claims wordings

There is no secret to this because it uses similar techniques to the reinsurers who underwrite the plans and base their premiums on the likelihood of a claim. Unlike reinsurers, it does not incorporate assumptions of trends. Nor is there any fat or profit margin, because it simply reflects the most up to date incidence figures taking into account the comorbidities and other factors that influence them. Males and females demonstrate varying risk levels because many conditions are gender specific and others, such as heart attack, affect one sex more than the other. Similarly, many conditio...