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Archive for the tag “insurance underwriting”

Politically Incorrect Statistics

Warren Buffet is praised for his ability to analyze the performance of companies in which he considers investing.  He uses information about the companies to predict future performance.  He has been very successful as an investor.

Bookies take bets on sporting events and base the “odds” for winning on statistical analysis of many factors about teams and athletes.

Insurance companies use underwriters to predict life expectancies and health risks based on statistics for people in certain categories based on age, weight, family medical history, and other factors, such as whether a person smokes or consumes alcohol.  They don’t know which smokers will develop lung cancer, but they know that smokers, for example, have a higher risk statistically than do non-smokers.

The TV show Criminal Minds is about a “behavioral analysis unit” known by the acronym BAU.  They study patterns of criminal behavior to solve crimes.

Analyzing companies, teams, and individuals is apparently done using statistical information because there is value for predicting probabilities of behavior (or danger) based on statistics about past behavior or performance.

Statistics are just numbers calculated by mathematical principles.  Statistics are not mean or prejudiced about race or religion.

Despite the neutrality of the process of statistical analysis, many people get offended by what the numbers reveal.

We are not supposed to “profile” Muslim Arabs as terrorists because that is somehow “prejudiced” despite the historical facts that the terrorists responsible for the 9/11 attacks and many other terrorist acts fit that category.  You are not paranoid (or prejudiced) if they are really after you.  The jihadists have said they are in a holy war with non-islamic people, i.e., infidels.  The statistics bear that out.

The federal government has told us recently that it needs to look at private phone records of American citizens, which many see as a violation of rights to privacy, for the greater good of protecting us.  Would it not also help protect us to focus on tracking people who “fit the profile” of terrorists?  I do not see that as islamophobia.  Wouldn’t that be for the greater good of protecting Americans?

Who says I am unlikely to become an NBA star?  Are those scouts prejudiced against me because they are considering my age, vertical leap, speed, shooting percentages and stuff like that?  They think, based on statistics, that I won’t do well in the league.

I like sports that involve timed races, such as track and swimming.  Your time is your time, regardless of color.  Is it unfair that a skewed percentage of Olympic sprinters are black and the vast majority of Olympic swimmers are white?  Oh, well!  The performances speak for themselves.  Warren Buffet probably would not bet on me to win the 100 meter event in track, you know, based on statistics, including my time in prior races.  It is what it is, whether I like it or not.  Pulling the race card does not change how fast or slow I run or swim.

I understand intellectually, but I prefer to say that I am a victim of racial profiling which, my friends, is politically incorrect.

Please join me in protesting my exclusion from the NBA.

The Answer Man

The premium for my private health insurance went up $150.00 per month.  I learned about it when I called to pay with a “check by phone.”

Me:  That can’t be right.  My insurance has paid nothing for me this year.  How can the premium increase so much?

Premium Collector:  That is a decision made in underwriting.

Me:  I don’t see the basis for an increase.  Based on my health history and lack of claims, you are already making 100% profit on me.  Please transfer me to Underwriting.

Customer Service (after a delay in getting transferred):  Customer service.  How can I help you?

Me:  I was holding for someone in underwriting.

Customer Service:  Perhaps I can help.  What is your question?

Me:  Why did my premium go up $150 per month?

Customer Service:  That is determined by underwriters.

Me:  What did they determine about me?  I have had no claim.  You have paid nothing.  Even if I had a claim, I would have to use up my deductible before you’d pay.

Customer Service:  That is out of my department.  Have I answered all your questions satisfactorily?

Me:  No.  May I speak with someone in underwriting?

Customer Service:  No.  Have I answered all your questions?  Would you like to participate in a brief survey to give us valuable feedback about your experience calling our office today?

Me:  No.  Please connect me with your supervisor.

Customer Service:  Certainly, but first, would you like to conveniently pay your premium by phone, using the bank account information in our system, drafted from the account ending in 1234?

Me:  No.  Like I said, I want to talk to someone who can explain my premium increase.

Customer Service:  Please hold while I connect you.

Supervisor:  How can I assist you?  It is our goal to provide excellent customer service.

Me:  That is a wonderful goal.  I hope that you can do that for me.  I am wondering about my recent rate increase because nothing has been paid under my policy.

Supervisor:  Pursuant to HIPPA regulations, I cannot disclose personal information about your health history.

Me:  It is my health history.  You don’t have to tell me about it.  I can tell you that no claims were made or paid.  I don’t smoke or drink much or go out with girls who do.  I’m healthy as a horse.  Why the increase?

Supervisor:  It might not be you at all.  You are in a pool of all other people, some of whom have very poor health, so we have to raise your rates.

Me:  If I had poor health you would not insure me in the first place.  Isn’t that why I had to apply and give you my medical history going way back to when I had my tonsils out 45 years ago?

Supervisor:  Under the new health insurance laws we will not be able to exclude people and we are required to provide coverage for types of benefits that you might have not purchased in the past, such as maternity benefits.

Me:  I’m glad you brought that up.  Please do not charge us for maternity coverage.  We are past that stage of life.

Supervisor:  You must have maternity benefits in your policy.  You have no choice.

Me:  Just because some 92 year old in Paraguay had a baby doesn’t mean we will.  She is in the Guinness Record Book.  Do you charge people even older than us for maternity coverage?  What if we were 70 or 80 years old?

Supervisor:  Then you would be on Medicare.

Me:  I can hardly wait.

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