ABSTRACT
The empirical evidence from different countries point out many of those who die from coronavirus would have died anyway in the relatively near future due to their existing frailties or co-morbidities. The acceleration of the mortality conceives the underlying insight according to deaths are "accelerated" ahead of schedule due to COVID-19. Starting from this idea, we forecast the future mortality acceleration, based on the deterioration due to the presence of the comorbidities at COVID-19 diagnosis. Accordingly, we explicitly determine the contribution of each comorbidity on the acceleration forecasting, showing the future trend of the excess of deaths due to the COVID-19. To this aim, our proposal consists in developing a revised Charlson Comorbidity Index in a stochastic environment. Based on a post-stratification scheme, we obtain an unbiased comorbidity index that varies by age, centered on the reference population.
ABSTRACT
The Covid- I9 pandemic caused an alarming mortality stress. The evidence shows that a significant proportion of people who die from Covid-19 are in a frail state. According to this consideration, we assume that the mortality shocks are related to a group of the individuals with some co-morbidities at Covid-19 diagnosis. In other words, the mortality shocks present a specific characterisation, which consists of a causal connection with pre-existing conditions, and the phenomenon could be described as a mortality acceleration. In this paper, an Accelerated Mortality Model is proposed in order to capture the different effects on mortality that depend on the evolution of the pandemic and the presence of co-morbidities at diagnosis. Furthermore, we assess the impact of Covid-19 mortality acceleration on a set of traditional life insurance contracts. We observe that, although mortality acceleration by Covid-19 affects more markedly the elderly and unhealthy sub-populations, it could be considered as a temporary shock with a limited impact on the life insurance market.
ABSTRACT
Life insurance profitability depends on reliable mortality risk projections and pricing. While the COVID-19 pandemic has caused disruptions around the world, this is a temporary mortality shock likely to dissipate. In this paper, we investigate the long-run impact of COVID-19 on life insurance profitability. Due to the long-run dynamics of the mortality characterised by a decreasing effect of the COVID-19 mortality acceleration, we suggest proactive mortality risk management by implementing prompt premium adjustments, in order to increase the resilience of the business.