How does unequal life expectancy affect life insurance?
The recent international study published in Science Advances highlights the significant and unequal declines in life expectancy in India during the COVID-19 pandemic.
Life expectancy in India dropped by 2.6 years in 2020 compared to 2019. Women and marginalized social groups suffer the greatest declines.
In the United States, similar patterns of unequal life expectancy can be observed, particularly among marginalized communities.
This disparity in life expectancy has profound implications for life insurance. Life insurance companies must consider these disparities when assessing risk and determining premiums.
Higher mortality rates among certain groups can lead to higher premiums. This makes life insurance less accessible to those who may need it the most.
In the U.S., life expectancy varies significantly across different demographic groups. These disparities are influenced by a range of factors, including socioeconomic status, access to healthcare, and underlying health conditions.
Life insurance companies need to account for these differences to ensure fair and equitable access to life insurance for all individuals.
Insurers can better serve their diverse clientele when they understand and address the root causes of these disparities.
What can be done to address these disparities?
The study also reveals that mortality across India was 17% higher in 2020 compared to 2019. Marginalized groups, again, experience the greatest declines in life expectancy.
Life insurance companies can play a role in addressing these disparities. For example, they can offer more affordable policies to marginalized communities.
They can also advocate for policies that address the underlying social determinants of health. This includes improving access to healthcare, education, and economic opportunities.
By doing so, life insurance companies can help mitigate the impact of future health crises and ensure that life insurance is accessible to all, regardless of their social or economic status.
Moreover, public health initiatives that aim to reduce health disparities can have a significant impact.
Life insurance companies can partner with these programs to support their efforts and promote healthier lifestyles.
Additionally, policymakers can implement measures to address systemic inequalities and invest in underserved communities.
These efforts can help reduce the life expectancy gap and create a more equitable society.

How can life insurance companies adapt to changing life expectancy?
The study found that marginalized groups in India experienced greater life expectancy declines than the most privileged social groups.
This pattern is also evident in the United States, where marginalized communities often face higher mortality rates.
Life insurance companies must adapt to these changing mortality trends. They can use high-quality data to accurately assess risk.
They need to consider factors such as age, gender, and social group when determining premiums.
Life insurance companies can also leverage technology to better understand and respond to these trends.
Advanced data analytics and machine learning can help insurers identify patterns and predict future mortality rates more accurately.
This can lead to more personalized and fair pricing of life insurance policies.
Furthermore, insurers can develop products that cater to the specific needs of different demographic groups, such as term life insurance policies with flexible terms and benefits.
Finally, insurers need the keep informed about the latest research and trends in public health, so they can continue to evolve and provide valuable services to their customers.