Research On The Pricing Of Critical Illness Insurance Under The New Critical Illness Table

Since its introduction into China in 1995,has been constantly updated and improved to meet people’s needs in the context of China’s insurance market,while the public’s awareness of insurance has also been growing and critical illness insurance has become an increasing focus of attention.However,behind the explosive development of the critical illness insurance market,the continuous emergence of new products for critical illness insurance,making the first edition of the "Code of Practice for the Use of the Definition of Disease for Critical Illness Insurance"(hereinafter referred to as the "Old Code")in 2007 no longer applicable to the current development of the insurance market,thus 2020 In 2020,the China Insurance Association(CIA)and the Chinese Medical Practitioners Association(CMA)once again revised the Old Code and issued the "Code of Practice for the Use of the Definition of Sickness for Critical Illness Insurance"(2020 Revised Edition)to provide detailed explanations on the types and number of sicknesses,under the guidance of the China Banking Regulatory Commission,officially released a new version of the "Experience Incidence Table for Major Diseases in China’s Life Insurance Industry(2020)"(hereinafter referred to as the "2020 version of the Critical Illness Table"),it is necessary to conduct an academic study on the pricing of critical illness insurance in China based on the new critical illness table,which will also provide better theoretical guidance to insurers in developing critical illness insurance and even life health insurance.Based on the above background,this paper uses a multi-state Markov model to calculate the net wholesale premiums for critical illness insurance for men aged 0 to 85 years.The paper begins with a detailed discussion of the definition of critical illness insurance and insurance liabilities,in which the basic actuarial assumptions for pricing critical illness insurance are explained,mortality assumptions,interest rate assumptions and additional cost rate assumptions.Then,an empirical study is conducted using a multi-state Markov model with reasonable interest rate assumptions based on the New Critical Illness Table 2020 Edition and the Additional Expense Rate Table issued by the BCI,while the premiums under the old Critical Illness Table are measured and compared with the premiums under the new Critical Illness Table for analysis.The article concludes with an analysis of the possible risks in the pricing of critical illness insurance in terms of data sources,pricing models and external environmental influences,and makes some recommendations.