THE Insurance Commission will soon issue a guideline for conducting a study aimed at updating the country’s mortality table which will show the rate of deaths occurring in a defined population during a given period, or survival from birth to any given age.
This is the first such study in almost four decades and it is an important undertaking, according to the insurance commissioner, Emmanuel Dooc
The purpose of the study is to produce an updated mortality table based on the Philippine industry mortality experience using more updated data, in light of current underwriting and marketing practices as well as the new regulations issued by this Commission.
The IC chief said the updated mortality study will be very useful to life companies, not only in product pricing and benchmarking of mortality experience, but also in the computation of reserves using the Gross Premium Valuation Standards which require the use of best estimate assumptions. The mortality table, he added, would benefit both the life insurance sector and the insuring public. Statistics included in the table would show the probability a person’s death before their next birthday, based on their age.
The IC guidelines will contain “the description of the study, the procedures thereof and the data and report that will be required of from all life insurance companies,” Dooc said.
The exposure draft will be circulated to all life insurance companies through the Philippine Life Insurance Association, the umbrella organization of all life insurance companies in the country, for comments.
Based on the draft circular letter, all required data and reports would be submitted to the IC for consolidation.
The analysis of the consolidated data will be carried out by the Actuarial Society of the Philippines (ASP) for the preparation of reports and recommendations.
The IC said a special tool solely developed for this study would be used in the processing of data of individual records of each company to ensure data privacy and security. Participating life insurance companies for their own mortality studies may use the same tool.
“The ASP has commissioned the development of a mortality study software to facilitate the preparation of the mortality data contributions of each company and to maintain data confidentiality for life companies,” Dooc said.
This new study will cover experience from policy anniversaries in 2009 up to 2014. It will be conducted using policy count and will only cover direct, standard risk, individual business.
It also aims to analyze experience by attained age last birthday, attained age nearest birthday, gender, product type and underwriting basis. The results of the experience will be assessed in comparison with the Basic 1973-1978 Philippine Intercompany Mortality Table.
The Actuarial Society aims to release the updated Mortality Table by the first quarter of 2017.