Evaluation of the degree of policyholder’s risk for the individual’s health insurance coverage

A policyholder’s degree of health risk could be classified as normal or better than normal or high or bad. We examine the relationship between the policyholder’s degree of health risk and the effect of his demographic factors. A quantitative model is proposed to support decision-underwriting of the...

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Autores principales:	Fuad A. A. Awwad, Emad Abdelgalil Ali Ismail
Formato:	article
Lenguaje:	EN
Publicado:	Taylor & Francis Group 2018
Materias:	health insurance degree of risk underwriting demographic factors Business HF5001-6182 Management. Industrial management HD28-70
Acceso en línea:	https://doaj.org/article/b1c69c7e195d4269bf4720ead43885ba
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spelling	oai:doaj.org-article:b1c69c7e195d4269bf4720ead43885ba2021-12-02T14:07:32ZEvaluation of the degree of policyholder’s risk for the individual’s health insurance coverage2331-197510.1080/23311975.2018.1477499https://doaj.org/article/b1c69c7e195d4269bf4720ead43885ba2018-01-01T00:00:00Zhttp://dx.doi.org/10.1080/23311975.2018.1477499https://doaj.org/toc/2331-1975A policyholder’s degree of health risk could be classified as normal or better than normal or high or bad. We examine the relationship between the policyholder’s degree of health risk and the effect of his demographic factors. A quantitative model is proposed to support decision-underwriting of the insurer by segmenting the health insurance underwriting portfolio to four risk groups, which are different and mutually exclusive (low risk, normal risk, high risk, bad risk) based on some demographic factors affecting the degree of risk. The likelihood of the insured to risk groups has been estimated using polynomial logistic regression analysis, and the degree of risk most likely has been determined to take appropriate underwriting decision. This study is based on experience of one of the insurance companies in Saudi Arabia, and the subjects were selected using a random sample for detailed data on individual health insurance during the period 2013–2015, based on the random numbers generated. We found a relationship between the degree of health risk and the policyholder’s demographic factors. Using this result, we were able to calculate the probabilities of affiliation of the insured for various degrees of risk. This paper presents a model for the rationalization of underwriting decisions in the individual health insurance, by classifying the policyholder within the appropriate insurance risk group. In addition, this paper enables to determine the appropriate insurance premium for every policyholder according to his degree of risk and this leads to reduction of the possibility of adverse selection of insurer.Fuad A. A. AwwadEmad Abdelgalil Ali IsmailTaylor & Francis Grouparticlehealth insurancedegree of riskunderwritingdemographic factorsBusinessHF5001-6182Management. Industrial managementHD28-70ENCogent Business & Management, Vol 5, Iss 1 (2018)
institution	DOAJ
collection	DOAJ
language	EN
topic	health insurance degree of risk underwriting demographic factors Business HF5001-6182 Management. Industrial management HD28-70
spellingShingle	health insurance degree of risk underwriting demographic factors Business HF5001-6182 Management. Industrial management HD28-70 Fuad A. A. Awwad Emad Abdelgalil Ali Ismail Evaluation of the degree of policyholder’s risk for the individual’s health insurance coverage
description	A policyholder’s degree of health risk could be classified as normal or better than normal or high or bad. We examine the relationship between the policyholder’s degree of health risk and the effect of his demographic factors. A quantitative model is proposed to support decision-underwriting of the insurer by segmenting the health insurance underwriting portfolio to four risk groups, which are different and mutually exclusive (low risk, normal risk, high risk, bad risk) based on some demographic factors affecting the degree of risk. The likelihood of the insured to risk groups has been estimated using polynomial logistic regression analysis, and the degree of risk most likely has been determined to take appropriate underwriting decision. This study is based on experience of one of the insurance companies in Saudi Arabia, and the subjects were selected using a random sample for detailed data on individual health insurance during the period 2013–2015, based on the random numbers generated. We found a relationship between the degree of health risk and the policyholder’s demographic factors. Using this result, we were able to calculate the probabilities of affiliation of the insured for various degrees of risk. This paper presents a model for the rationalization of underwriting decisions in the individual health insurance, by classifying the policyholder within the appropriate insurance risk group. In addition, this paper enables to determine the appropriate insurance premium for every policyholder according to his degree of risk and this leads to reduction of the possibility of adverse selection of insurer.
format	article
author	Fuad A. A. Awwad Emad Abdelgalil Ali Ismail
author_facet	Fuad A. A. Awwad Emad Abdelgalil Ali Ismail
author_sort	Fuad A. A. Awwad
title	Evaluation of the degree of policyholder’s risk for the individual’s health insurance coverage
title_short	Evaluation of the degree of policyholder’s risk for the individual’s health insurance coverage
title_full	Evaluation of the degree of policyholder’s risk for the individual’s health insurance coverage
title_fullStr	Evaluation of the degree of policyholder’s risk for the individual’s health insurance coverage
title_full_unstemmed	Evaluation of the degree of policyholder’s risk for the individual’s health insurance coverage
title_sort	evaluation of the degree of policyholder’s risk for the individual’s health insurance coverage
publisher	Taylor & Francis Group
publishDate	2018
url	https://doaj.org/article/b1c69c7e195d4269bf4720ead43885ba
work_keys_str_mv	AT fuadaaawwad evaluationofthedegreeofpolicyholdersriskfortheindividualshealthinsurancecoverage AT emadabdelgalilaliismail evaluationofthedegreeofpolicyholdersriskfortheindividualshealthinsurancecoverage
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Evaluation of the degree of policyholder’s risk for the individual’s health insurance coverage

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