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I’m not afraid of death; I just don’t want to be there when it happens - Why predicting death is big business for insurance


http://www.predictiveanalyticsworld.com/patimes/deathwatch-five-reasons-organizations-predict-when-you-will-die

woody allen death

1. Healthcare: predicts death to help prevent it. For example, Riskprediction.org.uk predicts your risk of death in surgery, based on aspects of you and your condition, in order to help inform medical decisions. In other work, psychiatric research predicts which patients are at the greatest risk of suicide.

2. Life insurance: prices policies according to predicted life expectancy. A growing number of life insurance companies go beyond conventional actuarial tables and employ predictive analytics to establish mortality risk. It’s not called death insurance, but their core analytical competency is to calculate when you are going to die.

3. Law enforcement and military: predict kill victims in order to protect. U.S. Armed Forces conduct research to analytically predict terrorist attacks. Researchers also assess the risk to individual soldiers, e.g., when parachuting. Law enforcement in Maryland applies predictive models to detect inmates more at risk to be perpetrators or victims of murder. Further, university and law enforcement researchers have developed predictive models that foretell murder among those previously convicted for homicide.

4. Safety institutes: predict system failure casualties. For example, researchers have identified aviation incidents that are five times more likely than average to be fatal, using data from the National Transportation Safety Board.

5. A top-five U.S. health insurance company: predicts the likelihood an elderly insurance policy holder will pass away within 18 months in order to trigger end-of-life counseling, e.g., regarding living wills and palliative care. The predictions are based on clinical markers in the insured’s recent medical claims.

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I thought actuaries have done this forever:

2. Life insurance: prices policies according to predicted life expectancy. A growing number of life insurance companies go beyond conventional actuarial tables and employ predictive analytics to establish mortality risk. It’s not called death insurance, but their core analytical competency is to calculate when you are going to die.

Geege, I think the actuarial table thing is still dominant in the insurance industry - from what I know, the actuarial tables are still the primary method. Big Data tech is still relatively new and insurance companies are (not surprisingly) risk averse, so are only now getting around to adopting. If I hear otherwise I'll get back to you...

Thanks, Mo.  

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