Lifelong Learning

Add +50 Debits up to Decline

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The connection between OSA and SCD is getting stronger according to a recent study by the Mayo Clinic.  This information has profound implications for how life underwriters approach this combination of impairments.  When I started in the profession last century, not much thought (or rating) was given to OSA.  Times have changed and we now know more about the risk. 

Will we use this new data or once again succumb to market forces?

Yes, I Would Like Some Statins with my Double Cheeseburger

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I am admittedly less antagonistic about more widespread use of statins in adults due to the the results of the Jupiter Study than about feeding statins to kids. Check out this NT Times article. And in case the link doesn’t work, here is the full permalink address.

http://www.nytimes.com/2008/11/10/health/10heart.html?partner=permalink&exprod=permalink

I’ll continue following the medical community reaction to this study.

One Sweet Idea

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According to the CDC, the incidence of diabetes increased 90% during the 10-year period ending in 2007. So is any company working in the brokerage market surprised to hear that some competitors are now offering Preferred rates to applicants who have IGT?

“He doesn’t have diabetes. He has IGT, not diabetes.”

This is one slippery slope. I strongly caution underwriters to be extremely selective when offering the best mortality rate for future diabetics. Take a hard look at the applicant’s health behaviors trend. Whether or not an individual goes on to develop full-blown diabetes from an impaired glucose tolerance state is strongly dependent upon current and future behaviors.

Last century when I was President of the Texas HOLUA I had the opportunity to ask one of the leading diabetes specialists some questions about my personal situation. Dr. Norman Kaplan at Southwestern Medical Center, University of Texas, Dallas addressed the group and I talked family history with him. I mentioned my strong family history for diabetes and asked Dr. Kaplan how I could avoid diabetes in the future. His reply was simple and eloquent:

“Stay as thin as you possibly can.”

Good advice for a lot of what ails you.

The Lesser of Two Evils

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Back in May the FDA released an advisory on Chantix. The same month a study from The Institute for Safe Medication Practices shed light on the numbers:

  • 544 reports suggesting Chantix may be related to a loss of glycemic control
  • 224 reports classified as potential cardiac rhythm disturbances
  • From May 2006 through December 2007, the FDA received 227 reports of suicidal acts, thoughts or behaviors, 397 cases of possible psychosis and 525 reports of hostility or aggression.

I think I’d rather keep smoking.

Read a Book a Week – Off The Shelf

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One of my less than normal habits consists not only of the number of books I read, but also the manner in which I read them.  At any given time, I could be reading between 8-10 books, each at a different stage of completion.  I rarely read just one book at a time.  So to sooth my latest obsession I’ve started reading Manias, Panics, and Crashes by Charles Kindelberger.  I expect the same type of lessons learned from reading Extraordinary Popular Delusions and the Madness of Crowds by Charles Mackay.  Remember that the good times never last as long as you would wish and when times are bad things do eventually get better.

Different perhaps, but better.

I changed the theme of my blog and hope you like it.  The new appearance is clean and easier to read than the last theme.  Of course, I reserve the right to revert.

The Financial Meltdown – Predictions for Management

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The time usually spent on reading and writing this past month was completely devoured by reading and staying current on the global financial meltdown.  It is at precisely times like this when we try to figure out what’s happening and what it means to each of us.  After absorbing a riduculous amount of information I came to the realization that this was becoming an obsession. As events continue to unfold I’m certain my obsession will only get worse.

OK.  What if I manage a life underwriting division for an insurance company?  I thought about the possibilities and decided to make some predictions.  If I’m wrong, who cares?  But if I’m right, my blog traffic will go through the roof.

In no particular order this is what I think could happen.

  1. In the future there will be fewer financial firms.  If you haven’t already noticed, this is happening at a dizzying pace.  There will be more consolidations, mergers, and divestitures all contributing to a new financial landscape.
  2. Management will ask more questions.  How do you manage concentration risk?  Do you have checks and balances in place?  Do you use external independent third parties to audit your underwriting?  If no, why not? The devil will be in the details and personally I would rather have the answers to questions like these before they get asked.
  3. The people asking these questions may be your new owners (see #1).
  4. There will be a greater emphasis on risk management rather than risk assessment and selection.  Don’t rely on your actuaries for this one.
  5. There will be more, not less, regulation.
  6. Pressures to cut costs will intensify.

Peter Drucker once said there is nothing so useless as doing efficiently that which should not be done at all.  There will be new and better models for the underwriting function that at present do not exist.  If you’re excited about remote underwriting, the future gets even better with talent spread around the world, web meetings, office-less office workers, and more.