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Some Notes on the Average Duration of an Income Protection Claim*

Published online by Cambridge University Press:  17 April 2015

Isabel Maria Ferraz Cordeiro
Isabel Maria Ferraz Cordeiro*
Affiliation:
Escola de Economia e Gestão, Universidade do Minho, Campus Universitário de Gualtar, 4710-057 Braga, Portugal, Tel: ++351-253-604563, Fax: ++351-253-676375, E-mail: icordeiro@eeg.uminho.pt
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Abstract

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Cordeiro (2002a) has presented a multiple state model for Income Protection (formerly known as Permanent Health Insurance) which enables us to analyse claims by cause of disability. In that paper average claim durations conditioned on recovery have been calculated.

Since, when an Income Protection claim is reported, the insurance company never knows whether it will end in recovery, in death or in expiry, to analyse only average claim durations conditioned on recovery could be misleading, specially for the people responsible for the claims control process.

The main purpose of this paper is to calculate average claim durations conditioned on death and average claim durations not conditioned on any particular mode of claim termination. We calculate these claim durations for different deferred periods, causes of disability and ages at the beginning of sickness and we analyse the results obtained.

Keywords

Income ProtectionPermanent Health InsuranceMultiple State ModelsAnalysis by Cause of DisabilityAverage duration of a claimAverage duration of a claim conditioned on death
Type
Articles
Information
ASTIN Bulletin: The Journal of the IAA , Volume 37 , Issue 1 , May 2007 , pp. 133 - 148
Copyright
Copyright © ASTIN Bulletin 2007

Footnotes

*

This research was supported by FCT – Fundação para a Ciência e Tecnologia, Portugal, under program POCTI.

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