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Smoker v. Non-Smoker

Published online by Cambridge University Press:  11 August 2014

N. G. Rhodes  and
P. J. Savill
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Extract

The title of the paper may suggest to readers that the authors are about to enter into a highly moralistic debate comparing those persons who take the ‘evil weed’ against those that lead ‘clean wholesome lives’. Whilst this is obviously not the case, the inference of competition is totally relevant. As the U.K. life insurance market moves slowly but surely to a smoker/non-smoker division, new dimensions of competition could open up between those offices who adopt a differential system and those who do not. One purpose of this paper is to comment on this feature.

The main purpose of the paper, however, is to highlight the financial and underwriting problems involved in this type of market which represents a highly significant departure from previous practice. Many readers will have already debated these problems within their offices and perhaps with their reassurer. However, to our knowledge, no discussion has yet taken place across the British actuarial profession as a whole, and we believe it highly desirable that such debate takes place. This paper, therefore, should be seen as offering nothing new or conceptually original, but as merely the catalyst for discussion.

Type
Research Article
Information
Journal of the Staple Inn Actuarial Society , Volume 27 , Issue 1 , March 1984 , pp. 1 - 29
Copyright
Copyright © Institute of Actuaries Students' Society 1984

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References

REFERENCES

(1) Cowell, M. J. and Hirst, B. L. (1980) ‘Mortality Differences Between Smokers and Non-Smokers’ T.S.A., vol. XXXII, pp. 185–213 (incorporating the State Mutual experience) and discussion pp. 215–261 (incorporating the Phoenix Mutual and other statistics).Google Scholar
(2) Gibbins, G. A. ‘A Review of the Mortality Differences Between Smokers and Non-Smokers and their Significance to Life Insurance Underwriting and Pricing.’ Presented at the 1981 annual meeting of the Canadian Institute of Actuaries on 11 June 1981. (To be published in a future volume of the Proceedings of the C.I. A.)Google Scholar
(3) Smoking and Health (1979). A Report of the Surgeon General U.S. Department of Health, Education and Welfare.Google Scholar
(4) Smoking or Health (1977). The Third Report from the Royal College of Physicians of London.Google Scholar
(5) General Household Survey 1978 (1980). Office of Population Censuses and Surveys (H.M.S.O.).Google Scholar