Critical injury insurance systems and methods

• US 20030200121A1
• Filed: 04/22/2002
• Published: 10/23/2003
• Est. Priority Date: 04/22/2002
• Status: Active Grant

• Current Assignee: Metropolitan Life Insurance Company (MetLife Incorporated), Swiss Reinsurance Company
• Original Assignee: Westport Insurance Corp. (Canada) (Swiss Re AG)
• Inventors: Santoloci, John L.
• Granted Patent: US 7,720,699 B2
• Time in Patent Office: Days
• US Class Current: 705/4
• CPC Class Codes: G06Q 40/08 Insurance

Abstract

Systems and methods for use in settling mass tort claims are disclosed for determining insurance premiums for asymptomatic claimants in order to provide an insured defined monetary benefit in the event of a future emergence of critical injuries associated with exposure to injurious substances or conditions. Asymptomatic claimant risk classification data are entered for each settling claimant. Mortality and critical injury tables are determined. Durational probabilities of surviving without emergence of a covered critical injury are determined from a present date for each future insurance coverage year during the remaining life of the settling claimant. The durational probabilities are multiplied by the critical injury rates and then multiplied by the amounts of the specified monetary benefits. The premiums are then determined for a single claimant and on an aggregate basis for all claimants in any particular batch of mass tort claims settlements.

Claims

1. A method for determining insurance premiums for defined monetary benefits payable to one or more asymptomatic claimants upon future emergence of at least one critical injury, comprising the steps of:

A) entering asymptomatic claimant risk classification data for the claimants;

B) determining a mortality table based on the data;

C) determining mortality rates from the mortality table;

D) determining a critical injury table based on the data;

E) determining critical injury incidence rates from the critical injury table;

F) determining first durational probabilities of surviving without emergence of the critical injury from a present date to each future insurance coverage year end;

G) multiplying the first durational probabilities by the critical injury incidence rates to determine second durational probabilities of critical injury emergence in future insurance coverage years;

H) multiplying the defined monetary benefits by the second durational probabilities to determine expected payments of the defined monetary benefits; and

I) discounting the expected payments for interest to determine net insurance cost on a present value basis.

2. A method of claim 1, the step of entering the asymptomatic claimant risk classification data comprising entering asbestos data selected from the group consisting essentially of age, sex, smoker non-smoker status, duration of exposure, and severity.

3. A method of claim 1, the step of determining a mortality table comprising selecting a standard mortality table.

4. A method of claim 3, further comprising the step of modifying the standard mortality table based on unique characteristics in the data.

5. A method of claim 1, the step of determining a critical injury table comprising selecting a standard critical injury table.

6. A method of claim 1, further comprising the step of modifying the critical injury table based on unique characteristics in the data.

7. A method of claim 1, further comprising the step of converting the net insurance cost to insurance premiums.

8. A method of claim 7, further comprising the step of loading one of both of future administrative costs and risk allowance to the insurance premiums to produce loaded single claimant premiums.

9. A method of claim 8, further comprising repeating steps A)-I) for each of the claimants, wherein the step of entering asymptomatic claimant risk classification data comprises entering information for each of the claimants.

10. A method of claim 9, further comprising aggregating the loaded single claimant premiums for all of the claimants to determine a total premium price.

11. A method of claim 9, the step of entering asymptomatic data comprising electronically processing batched information including data for each of the claimants.

12. A method of claim 11, further comprising electronically sorting through the batched information as a budgetary control procedure to determine whether additional claimants should be processed.

13. A method of claim 8, the step of determining first durational probabilities further comprising modifying the single claimant premiums for multiple covered critical injuries.

14. A method of claim 1, further comprising utilizing current capital market rates to select discount interest rates at each duration of insurance coverage.

15. A system for determining insurance premiums setting forth a monetary benefit for asymptomatic plaintiffs, comprising a computerized database for storing actuarial statistical information, insurance risk information and asymptomatic claimant risk classification data, the computerized database having a processor for processing the actuarial statistical information and insurance risk information with the claimant risk classification data to determine the premiums.

16. System of claim 15, further comprising means for producing an insurance product setting forth critical injury insurance for the monetary benefit.

17. A system of claim 16, further comprising means for producing an insurance product comprising an insurance certificate.

18. A system of claim 15, further comprising a network connection for connecting the computerized database with a remote computer.

19. A system of claim 18, the remote computer configured to download batched information including the asymptomatic claimant risk classification data for each of the claimants.

20. A system of claim 15, the computerized database configured to determine a mortality table based on the asymptomatic claimant risk classification data.

21. A system of claim 20, further comprising means for modifying the mortality table based on unique characteristics of the asymptomatic claimant risk classification data.

22. A system of claim 15, the computerized database configured to determine one or more critical injury tables based on the asymptomatic claimant risk classification data.

23. A system of claim 15, the computerized database configured to determine critical injury rates using single-decrement tables.

24. A system of claim 15, the computerized database configured to determine durational probabilities of surviving without emergence of a critical injury from the present date to each future year end of insurance coverage.

25. A system of claim 15, the computerized database configured to multiply durational probabilities with critical injury incidence rates to determine a durational probability of emergence in each future insurance coverage year.

26. A system of claim 25, the computerized database configured to multiply the monetary benefit with the durational probabilities.

27. A process for determining insurance premiums defining monetary benefits payable to asymptomatic claimants upon future emergence of at least one critical injury, comprising:

A) electronically loading asymptomatic claimant risk classification data for each of the claimants;

B) automatically selecting one or more mortality tables based on the data;

C) electronically determining mortality rates from the mortality tables;

D) automatically selecting one or more critical injury table based on the data;

E) electronically determining critical injury incidence rates from the critical injury tables;

F) electronically processing, for each of the claimants, first durational probabilities of surviving without emergence of the critical injury from a present date to each future insurance coverage year end;

G) electronically multiplying, for each of the claimants, the first durational probabilities by the critical injury incidence rates to determine second durational probabilities of critical injury emergence in future insurance coverage years;

H) electronically multiplying, for each of the claimants, the defined monetary benefits by the second durational probabilities to determine expected payments of the defined monetary benefits;

I) electronically discounting, for each of the claimants, the expected payments for interest to determine net insurance cost on a present value basis; and

J) electronically aggregating the net insurance costs for all claimants to determine a total premium price.

28. A process of claim 27, further comprising electronically sorting through the asymptomatic claimant risk classification data as a budgetary control procedure to determine whether additional claimants should be processed.