The Society of Actuaries (SOA) has selected Milliman to complete the data compilation for the latest cancer experience study in order to support the development of new cancer valuation tables. These tables will be presented to the National Association of Insurance Commissioners (NAIC) for adoption as the standard for setting reserves for cancer policies.
The objective of this project is to receive and summarize detailed cancer claim data from 2001 through 2011 from approximately 10-20 insurance companies. The desired end result is a comprehensive database of cancer claim costs aggregated along relevant factors such as age, sex, single vs. family, product type, and other product groupings.
Milliman will create coding routines that will analyze and validate the data to ensure that the submissions are logically consistent and that the values given are within the ranges expected for the product. Additional routines will be developed to calculate exposure and incidence rates in order to determine the final claim costs.
The current cancer valuation tables were publishing in 1985 based upon cancer experience from 1978 thru 1980. The evolution of cancer treatment over the past 30 years has rendered the 1985 Cancer Tables outdated. The results of this experience study will be used to develop a new set of tables that will replace the 1985 tables.
It is currently estimated that the companies participating in the study will represent approximately 70% of the U.S. cancer insurance industry. Data compilation of the study is targeted for late 2012. The proposed valuation table is to be presented to the NAIC in 2013.