Graeme Edwards
Graeme Edwards
Australian insurer TAL has announced it has adjusted its BMI calculation loadings to “provide a more accurate reflection of risks”.
Previously it had accepted overweight and obese customers at standard rates.
Now, the loading will increase with the rise of a customer’s rating on TAL’s BMI tables.
Graeme Edwards, of AIA, said BMI was already one of the things that was considered by New Zealand insurers, as part of a wider mix of risk factors.
But he said it was not as straightforward as it might appear. “Do you draw a line based on a number? Most of the All Blacks if you applied that wouldn’t get standard rates. You have to look at the whole person.”
But issues caused by increasing obesity rates were a worry for insurers, he said, and something that would have to be confronted over time.
“That population does create a long tail for insurers. That’s why you’re seeing more move down the health and wellness path.”
Noami Ballantyne, of Partners, agreed that New Zealand had TAL’s approach was not new when compared to the New Zealand environment.
She said it was surprising that they had used different loadings, because the same reinsurers catered for both countries.
“If you don’t [add loadings for obesity], it spreads the cost of obesity-related claims to all customers. What TAL is going to do by loading for BMI is reduce the premiums for people who aren’t overweight.”
She said the insurer would hope it was more appealing to people in a healthy weight range, as a result.
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