Rising obesity levels could trigger higher life insurance premiums for the overweight, according to a study published by Zurich-based reinsurer, Swiss Re.This content was published on April 6, 2004 - 12:43
The number of obese people in developed countries has risen threefold over the past 30 years, raising the risk of premature death and early payouts.
In a report published on Tuesday, Swiss Re, the world’s second-largest life and health reinsurer, said that the increasing prevalence of obesity was too significant for the life insurance industry to ignore.
“If left unchecked, it will have negative consequences for adult health and mortality in the future,” said the report.
Obesity is associated with heart disease, diabetes and some forms of cancer, and has been linked to premature death.
The study found that an obese 40-year-old, even if he did not smoke, was likely to die between six and eight years earlier than expected.
Swiss Re says higher mortality rates are likely to erode profits from existing life insurance policies where insurers are unable to increase premiums or adjust terms.
But the report called on life insurers to consider raising premiums on new policies taken out by the obese and people prone to obesity to take into account the increasing cost of claims.
It also suggested that people looking to buy life insurance should be screened for obesity.
“Looking ahead, the life insurance industry must tackle issues associated with increases in obesity by ensuring that the related risks are accurately assessed and rated, and that consumers are charged an appropriate premium to reflect the risk they present,” said the report.
Insurance companies in most countries already take a person’s size, weight, smoking habits and medical history into account before underwriting life and health policies.
"Generally life expectancy has been improving with less people smoking and with improvements in medical sciences but what we’re saying is that obesity is masking some of these improvements," Stuart Collins, a spokesman for Swiss Re, told swissinfo.
"All we are suggesting is that life insurers and the rest of the industry consider the increase in the prevalence of obesity in the future when they consider pricing," he added.
More Swiss overweight
Switzerland – although not as badly affected as the United States where nearly one in three is obese – is not immune from the trend towards obesity.
The Federal Health Office says 42 per cent of Swiss men and 28 per cent of Swiss women are overweight.
And there are three times as many overweight Swiss children today as there were 20 years ago.
Yves Seydoux, from santésuisse, an association which represents health insurance companies, said a hike in premiums in Switzerland would need the approval of the government, which sets the rate each year.
“Insurers do not have the power to decide whether to increase premiums for people who are putting their health at risk,” Seydoux told swissinfo.
“You would need a political decision to change that,” he added.
Swiss Re is calling for action to change government and consumer attitudes towards tackling obesity.
“Unless the prevalence of obesity is brought under control, consumers will bear the ultimate cost,” warned Ronald Klein, global head of pricing at Swiss Re’s life and heath business group.
“As consumers’ Body Mass Index goes up, so too will their premiums,” added Klein.
swissinfo, Isobel Leybold
10%-20% of men and 10%-25% of women in the developed world are estimated to be obese.
Almost one in three is obese in the US. Number of obese children in the US has doubled over the past 20 years.
42% of Swiss men and 28% of Swiss women are classed as overweight.
Three times as many Swiss children are overweight today as 20 years ago.
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