Researchers Submit Patent Application, “Automated Mortality Classification System For Real-Time Risk-Assessment And Adjustment, And Corresponding Method Thereof”, for Approval (USPTO 20210374868): Swiss Reinsurance Company Ltd.
2021 DEC 22 (NewsRx) -- By a
The patent’s assignee is
News editors obtained the following quote from the background information supplied by the inventors: “The problems associated with risk transfer and risk pooling are integral elements in the operation of life insurance systems, By grouping individuals’ risk, the insurance systems are able to cover losses based on possibly future arising out of a common pool of resources captured by the insurance systems from associated individuals for the transfer of their risks. However, in order to maintain some degree of equity among individuals exhibiting different mortality risks, i.e. in order to derive a balance between a specific individual’s risk transferred and the amount of its resources pooled in return, the insurance systems have to capture, assess and classified the individual’s risk according to appropriately selected or filtered criteria and accepted characteristics. Historically, for a given risk transfer with a specific underwriting process. rates have been triggered by age and sex, and approximately nine-tenths of applicants have been accepted at the standard rote, and the rest has been individually rated or declined. However, from the late 1960s the insurance systems started to measure and consider more criteria, as e.g. non-smokers were charged lower rates. In the early 1990s, the process of adjusting the insurance systems’ risk assessment further expanded to segregated sex and smoker-distinct lives employing other criteria. This continued segmentation of the standard class attempts to reduce mortality cross-subsidies in which better risks financially subsidize poorer risks, and thus refining and stabilizing the overall operation of the insurance systems. Each of a newer smaller class is expected to display a narrower distribution of mortality than the larger class from which it emerged. In this application, preferred lives or life risks are risks chosen according to measurable and triggerable criteria in addition to sex and tobacco use and which are expected to experience lower mortality as a group than the remaining non-rated lives of the same age, known as residual lives or residual lives risks or residual standard. Characteristic for so-called preferred life insurance systems is the generation of separate premium rates for preferred and residual live risks of the same age classified into two or more classes based on expected differing mortality.
“A selected preferred group is expected to exhibit, on average, lower mortality than the residual group of individuals’ risks. This does not imply that all preferred live risks have lower expected mortality than all residual lives, but that, when taken as a group, they can be expected to. At a most elementary level in the prior art, the preferred lives concept, implemented into insurance systems, divides the standard sex and smoker-distinct class into two classes by the use of certain admission criteria which are objectively defined and measured and which are known to be predictive of relative mortality. At the extreme end of the application of the preferred life insurance system, this method results in a unique rate charged a particular individual based on that individual’s unique mortality risk profile. As long as death remains haphazard, the operational principle of the insurance systems is left intact. By removing any existent mortality cross-subsidy in the insured pool, i.e. the pooled individuals’ risks by the insurance system, the most dissected, preferred life insurance systems represents the opposite of charging oil pooled, i.e. insured, individuals an identical rate, thereby balancing the risk over all associated individuals who’s risk was transferred to the system. Therefore, such systems operate on complete risk transfer equity as opposed to complete risk transfer equality.
“A critical point for the operational risk management for such insurance system typically involves consideration of one or more criteria, which are correlated to an event or events influencing the risk transferred. The ability to predict the frequency or eventual likelihood of occurrence of such critical events has value and utility in many settings. Often, different insurance systems use different sets of criteria to assess the expected occurrence of the same (or similar) events. In some cases, the same insurance systems may also use different criteria sets in differing situations or differing times. Methods and systems for comparing different criteria sets are useful tools in the selection of criteria and the design and development of related products. However, in the case of coupling the insurance system with a second insurance system, e.g. a mutually synchronized reinsurance system for seamless risk transfer within a negotiated parameter range, or in order to compare the products from competing insurance systems, or designing new preferred products to replace or augment existing products, the different operation of the insurance systems makes it difficult or even impossible to use methods which could take such differences into account. Clearly, such comparison may also be useful in the selection of criteria and pricing of related products, and in determining the impact of criteria changes or granting various exceptions to criteria on pricing and potential profitability of such products.
“Another critical point for the operation of such insurance systems is complex process for assessing the appropriate risk of an individual on a mortality consistent basis. This is especially important for coupling a plurality of primary insurance systems to a second insurance system, i.e. reinsurance system, for hedging the operational risk and improve stability of the first insurance system by transferring the pooled individuals’ risks at least partly to the second insurance system. Furthermore, incorporating the thinking process of underwriters during risk assessment and risk categorization is technically complex. In the prior art, there are different systems, disclosing an approach to the discussed problems. E.g. the patent
“However, all of the prior art systems are not able to completely solve the most important technical difficulties arise from capturing and assessing the risk that is associated with preferred incidents, i.e. the fully-automated and easy-to-operate risk assessment system. The prior art systems are not able to perform real-time risk assessment for preferred life insurance system. Moreover, they are not able to perform the risk-assessment on a mortality consistent basis. The capability of arriving of a precise measurement of an individual’s preferred risk exposure is fundamental, inter alia, for the technical operation of risk-transfer systems or damage prevention/recovery systems, such as associated automated resource and risk pooling systems or automated insurance systems. The associated problem extends to the fact that the overall risk is typically spread over various single risks. Correspondingly, the different criteria and classes should be appropriately triggered. The overall associated or pooled risk cannot be captured or weighed on a automated bases by preferred life insurance systems as envisioned by the prior art providing an appropriate risk transfer.”
As a supplement to the background information on this patent application, NewsRx correspondents also obtained the inventors’ summary information for this patent application: “It is an object of the present invention to provide an automated real-time risk-assessment and adjustment system and method for measuring, accumulating and monitoring preferred life risks thereby providing a signaling system for transfer of specific risks associated with a risk-exposed individual from a first insurance system to an associated second insurance system based on the real-time risk-assessment and adjustment, which risk transfer is mutually synchronized between the first and second insurance system. Further, it is also an object of the present invention to provide a system and method for risk assessment and sharing of preferred life risks on a mortality consistent basis. It is a further object of the present invention to provide a system and method for real-time risk assessment and sharing of preferred life risks. It is another object of the present invention to provide a system and method allowing incorporate the thinking process of underwriters, refining the process and allowing for the best possible risk categorization on a completely automated basis.
“According to the present invention, these objects are achieved, particularly, by the features of the independent claims. In addition, further advantageous embodiments con be derived from the dependent claims and related descriptions.
“According to the present invention, the above-mentioned objects related to the measurement, accumulation and monitoring of preferred life risks are achieved, particularly, in that by means of a distinct-channel-based automated mortality classification system for real-time risk-assessment and adjustment, risks, which are associated with a plurality of risk exposed individuals, are at least partially transferred from a risk exposed individual to a first insurance system and/or from the first insurance system to an associated second insurance system, wherein the system comprises a table with retrievable stored risk classes each comprising assigned risk class criteria, wherein individual-specific parameters of the risk exposed individual are captured relating to criteria of the stored risk classes by means of the system and stored to a storage unit and wherein a specific risk class associated with the risk of the exposed individual is identified out and selected of said stored risk classes by means of the system based on the captured parameters, in that in a first channel, selectable by means of an user interface, to each of the risk classes of the table with retrievable stored risk classes, a first tolerance factor is determined and assigned to the corresponding risk class or user statements are posed for review, wherein in case that the captured parameter of a risk exposed individual fail to be matched to the criteria for one of the retrievable stored risk classes by means of the system, a relative mortality factor of the individual of the captured parameter is generated and compared to an average mortality of the closest matched class, and wherein based on the assigned first tolerance factor of the closest matched class, the system indicates whether to accept or reject a possible risk transfer for the individual for the closest matched class, in that in a second channel, selectable by means of the user interface, class category parameters with assigned criteria are defined comprising at least three class categories “standard”, “preferred” and “better preferred”, wherein a relative mortality factor is measured based on the captured individual’s specific parameters and in relation to the average of expected mortality for the specific risk class associated with the individual, wherein a second tolerance factor for an excess mortality is determined and assigned to the corresponding risk class, and wherein the system indicates whether to assign the individual to the class category parameter “standard” or to a better class category “preferred” or “better preferred” based on the second tolerance factor, thereby providing the movement of the individual from class category “standard” to better class category, factors “preferred” and/or “better preferred”, and in that in a third channel, selectable by means of the user interface, individual-specific data are captured by the system, wherein the system triggers for predefined decline parameters in the captured individual-specific parameters, and upon detecting one of the predefined decline parameters the system declines a possible risk transfer for the individual for any class by transmitting appropriate decline data. It is important to note that the above given 3 class categories are just exemplary in number as well as in name definition. In the absolute minimum, the second channel must comprise at least two distinctive class categories otherwise there will be no reclassification mean. However, the second channel may also include more that three class categories, as for example 6 class categories (“standard”, “standard plus”, “preferred”, “preferred plus”, “better preferred”, “better preferred plus”), which allows for a more sophisticated and differentiated selection by means of the second channel. Such a second channel extended by more class categories, allow for a more distinctive movement between the class categories, and, thus, a more distinctive categorization, classification and recognition of the cases by means of the system. A more distinctive class categorization also enhances the power of the automated mortality classification system, technically providing the user or underwriter with an automated unique way to a more distinctive reclassification on a mortality consistent basis. Thus, improvement factors’ that simulate the understanding process of underwriters, can be automatically captured by means of the system and refine the technical process allowing for the best possible risk categorization. Further, it is also important to note that better class category factors typically mean improved and thus betterclass category factors can, for example, correspond or be assigned by the system to lower premium or cost for the risk transfer, which is based on the lower morality associated with betterclass category factors. The risks associated with a plurality of risk exposed individuals can e.g. at least partially be transferable on a facultative basis by means of the automated mortality classification system from a risk exposed individual to a first insurance system and/or from the first insurance system to an associated second insurance system. Each of the risk classes of the table with retrievable stored risk classes can e.g. be associated to at least one financial product accessible in a dedicated data store, wherein the system determines, for each of the risk classes, an expected occurrence rate, wherein the system divides the expected occurrence rates by an average rate and determining a relative risk ratio as relative mortality factor for each of the risk classes based on the data relating to the criteria associated with said risk classes, wherein the system calculates correlated risk ratios between at least two of the risk classes that are identified in said step of identifying and determining a dependence between the at least two different risk classes, wherein the system compares the relative risk ratios and the correlated risk ratios with empirical data and generating comparative risk data to characterize the relative risks associated with the plurality of products, wherein the system corrects the relative risk ratios in a case the comparative risk data is out of a defined range comparing with the empirical data; and wherein an output device for outputting the corrected risk ratios. Further, the first channel can e.g. comprise a table with retrievable stored impairment criteria, wherein the first channel is only activatable in case of triggering at least one of the stored impairment criteria within the captured parameters of the risk exposed individual resulting in a failure to be matched to one of the risk classes, and wherein the table with retrievable stored impairment criteria comprises as trigger criteria for medical impairment criteria anemia, anxiety, asthma, atrial fibrillation and flutter, atrial septal defect, barrett’s esophagus, bicuspid aortic valve, blood pressure, build, combination of blood pressure and lipids, combination of build and blood pressure, combination of build and lipids, crohn’s disease, depression, diabetes mellitus type 2, epilepsy, mitral insufficiency, obstructive sleep apnea, rheumatoid arthritis, skin tumors other than melanoma, surgical treatment of obesity, thyroid, ulcerative colitis; comprises as trigger criteria for medical test criteria cholesterol/HDL ratio, EBCT, glomerular filtration rate (isolated elevation), EKG-T wave changes, impaired glucose tolerance, liver enzymes (isolated elevation), microalbuminuria (isolated elevation), proteinuria (isolated elevation), triglycerides; and comprises as trigger criteria for non-medical impairments aviation (private), driving, foreign travel, occupation, scuba diving. The second channel can e.g. comprise a table with retrievable stored improvement criteria, wherein the captured individual’s specific parameters additionally comprise at least on of the retrievable stored improvement criteria, and wherein the improvement criteria comprise key preferred criteria associated with the core criteria, as build, blood pressure and treatment, cholesterol and HDL (High Density Lipoprotein) ratio and treatment, family history, as well as Improvement factors, as glycohemoglobin, statins treatment, prevention, wellness, NT-proBNP, ECG, stress test, and/or EBCT of the risk exposed individual. In the second channel, the at least three categories “standard”, “preferred” and “better preferred” refer to life-risks, which are either “standard”, i.e.”
There is additional summary information. Please visit full patent to read further.”
The claims supplied by the inventors are:
“1. An automated, distinct-channel-based automated mortality classification and signaling system for real-time risk-assessment and adjustment, risks associated with a plurality of risk exposed individuals being at least partially transferable from a risk exposed individual to a first insurance system and/or from the first insurance system to an associated second insurance system, the system including a table with retrievable stored risk classes each comprising assigned risk class criteria, individual-specific parameters of the risk exposed individuals being captured relating to criteria of the stored risk classes by the system and stored in a memory, a specific risk class associated with the risk of the exposed individual being identified out and selected of the stored risk classes by the system based on the captured parameters, the system comprising: a user interface via which a first channel, a second channel, and a third channel are selectable; and processing circuitry configured to in the first channel for each of the risk classes of the table with retrievable stored risk classes, determine and assign a first tolerance factor to the corresponding risk class, the criteria and/or related measuring parameters being dynamically adapted based on time-correlated incidence data for a preferred life risk condition indicating changes in the condition of the risk exposed individuals, when the captured parameters of a risk exposed individual fail to be matched to the criteria for one of the retrievable stored risk classes by the system, generate and compare a relative mortality factor of the individual of the parameters to an average mortality of the closest matched class, and based on the assigned first tolerance factor of the closest matched class, indicate whether to accept or reject a possible risk-transfer for the individual for the closest matched class, in the second channel, define class category parameters with assigned class category criteria comprising at least three class categories “standard,” “preferred,” and “better preferred,” measure a relative mortality factor based on the captured individual’s specific parameter and the class category criteria and in relation to an average of expected mortality for the specific risk class associated with the individual, determine and assign a second tolerance factor for an excess mortality to the corresponding risk class, and indicate whether to assign the individual to the class category parameter “standard” or to a better class category “preferred” or “better preferred” based on the second tolerance factor, thereby providing the movement of the individual from class category “standard” to better class category factors “preferred” and/or “better preferred,” in a third channel, capture individual-specific parameter, trigger for predefined decline parameters in the captured individual-specific parameter, and upon detecting one of the predefined decline parameters, decline a possible risk-transfer for the individual far any of the risk classes by transmitting appropriate decline data, and based on the real-time risk-assessment and adjustment, transfer specific risks associated with the risk-exposed individuals from the risk-exposed individual to the first insurance system and/or from the first insurance system to the associated second insurance system, and generate and transmit an appropriate activation signaling to the first insurance system and/or to the associated second insurance system, the risk transfer being mutually synchronized between the first insurance system and second insurance system.
“2. The system according to claim 1, wherein by triggering predefined decline parameter in the captured individual-specific data, additional individual-specific parameters are requested and transmitted to an independent review entity, and only upon capturing the transmission of a check back confirmation of the review entity, the processing circuitry declines a possible risk transfer for the individual for the classes by transmitting the appropriate decline data.
“3. The system according to claim 1, wherein the processing circuitry at least partially transfers the risks associated with a plurality of risk exposed individuals on a facultative basis from a risk exposed individual to the first insurance system and/or from the first insurance system to the associated second insurance system.
“4. The system according to claim 3, further comprising: an input device provided in response to selection of a fourth channel for a facultative case summary submission for a new risk exposed individual, the fourth channel being selectable via the user interface when the captured parameters of the new risk exposed individual are not yet classified, the input device prompting for the new risk exposed individual of the first insurance system to enter facultative case summary information including risk factor information for evaluating a risk in providing risk cover by the second insurance system for the new risk exposed individual, wherein in response to received input, the processing circuitry is configured to render a facultative decision based on the received facultative case summary submission.
“5. The system according to claim 1, wherein when the captured parameters of a risk exposed individual are not yet classified, a freeform third channel extension is selectable via the user interface, the risk exposed individual being classified based upon matching to the parameters for one of the retrievable stored risk classes by the system, and the first channel and/or the second channel and/or the third channel are only selectable via the user interface, when the captured parameters of a risk exposed individual fail to be matched to the criteria for one of the retrievable stored risk classes.
“6. The system according to the claim 1, wherein each of the risk classes of the table with retrievable stored risk classes is associated to at least one financial product accessible in a dedicated data store, the processing circuitry is configured to determine, for each of the risk classes, an expected occurrence rate, divide the expected occurrence rates by an average rate and determine a relative risk ratio as relative mortality factor for each of the risk classes based on the data relating to the criteria associated with the risk classes, calculate correlated risk ratios between at least two of the risk classes that are identified, and determine a dependence between the at least two different risk classes, compare the relative risk ratios and the correlated risk ratios with empirical data and generate comparative risk data to characterize the relative risks associated with the plurality of products, correct the relative risk ratios when the comparative risk data is out of a defined range compared with the empirical data, and output the corrected risk ratios.
“7. The system according to claim 1, wherein the first channel comprises a table with retrievable stored impairment criteria, the first channel being only activatable in case of triggering at least one of the stored impairment criteria within the captured parameters of the risk exposed individuals resulting in a failure to be matched to one of the risk classes, and the table with retrievable stored impairment criteria comprises as trigger criteria for medical impairment measuring parameters anemia, anxiety, asthma, atrial fibrillation and flutter, atrial septal defect, barrett’s esophagus, bicuspid aortic valve, blood pressure, build, combination of blood pressure and lipids, combination of build and blood pressure, combination of build and lipids, crohn’s disease, depression, diabetes mellitus type 2, epilepsy, mitral insufficiency, obstructive sleep apnea, rheumatoid arthritis, skin tumors other than melanoma, surgical treatment of obesity, thyroid, ulcerative colitis; comprises as trigger criteria for medical test criteria cholesterol/HDL ratio, EBCT, glomerular filtration rate (isolated elevation), EKG-T wave changes, impaired glucose tolerance, liver enzymes (isolated elevation), microalbuminuria (isolated elevation), proteinuria (isolated elevation), triglycerides; and comprises as trigger criteria for non-medical impairments aviation (private), driving, foreign travel, occupation, scuba diving.
“8. The system according to claim 1, wherein the second channel comprises a table with retrievable stored improvement criteria, the individual-specific parameters additionally comprise at least one of the retrievable stored improvement criteria, and the improvement criteria comprise key preferred measuring parameters associated with the build, blood pressure and treatment, cholesterol and ratio and treatment, family history, glycohemoglobin, statins treatment, prevention, wellness, NT-proBNP, ECG, stress test, and/or EBCT of the risk exposed individual.
“9. The system according to claim 1, wherein the processing circuitry at least partially transfers risks associated with the plurality of risk exposed individuals from the risk exposed individual to the first insurance system and/or from the first insurance system to the associated second insurance system, and generates and transmits the appropriate activation signaling to the first insurance system and/or to the associated second insurance system.
“10. The system according to claim 1, wherein the processing circuitry is configured to automatically negotiate the risk class criteria between the first insurance system and the second insurance system.
“11. The system according to claim 1, wherein the one or more risk classes are associated with one or more risk class criteria, and the processing circuitry is configured to further modify one or more of the criteria, re-determine the relative risk ratio, and determine an impact of the modification on the relative risks associated with the products.”
There are additional claims. Please visit full patent to read further.
For additional information on this patent application, see: BERTSCHE,
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