> GBurch1@aol.com: In key market segments (high-wage earners in the First World
> and other wealthy people) competitive pressures drive actuaries to work their
> calculations to the edge of profitability. Thus, I find your statement above
> to be wrong: Any attempt by one life insurance company to overstate mortality
> rates will be quickly exploited by competitors.
Greg I think we are saying the same thing: that insurance companies know
a great deal about the true mortality of us, however it is not in their
best interest that *we* know the true mortality of us.
When we buy insurance, we are betting (in a sense) that we will die,
and the insurance company is betting that we wont. They are holding
all the cards here, controlling the information. I dont doubt that their
profit margins are razor thin, and that they actually take a loss on a
large percentage of their clients. We could better estimate our true
mortality by inspecting the price matrix of life insurance. spike
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