Revising the standard cancer definition will not short change policyholders, writes Ross Campbell
Prostate cancer is the second most common cause of cancer death in men, accounting for one in nine of all male cancers.
The incidence of all cancers among men has been remarkably steady over the last 25 years. For example, in 1971 insurers would have expected 575 out of every 100,000 male policyholders in their late 50s to suffer a cancer each year. In 1997, the corresponding figure was 580 out of 100,000. This pattern, however, hides worrying trends. The most worrying of these is prostate cancer. In 1971, 19 out every 100,000 men aged in their 50s suffered from it. In 1992 the figure was 33, but most alarmingly the 1997 figure was 57 ' a 70% increase in only five years.
At present, the main medical screening technique for prostate cancer, the PSA test, is not totally accurate. In addition, treatment options are limited as the outcome of the cure can be worse than the illness itself. Consequently, there is no UK national screening program for prostate cancer. Recognising these limitations in the current screening methods, the Government is aiming to introduce population-based cancer screening if and when new research leads to screening techniques being sufficiently developed.
Medical studies have estimated that around 20% of men in their 50s suffer latent prostate cancer, so even allowing for the recent increases in incidence it is massively under-diagnosed. This is borne out by the experience of the US and Canada. In these health-conscious nations, prostate cancer is diagnosed at twice the rate of the UK. But better diagnosis could mean more claims ' and losses for insurers.
The fact that the ABI has decided to address the prostate cancer issue has been welcomed. Insurers and reinsurers have been aware of the potential problem for a number of years. However, the combined pressure of competition and the existence of standard definitions has meant that no one has been willing to make a unilateral move.
The Association of British Insurers (ABI) is consulting on two possible approaches to address the problem. The first option is to do nothing. In this scenario, it is envisaged that premiums for older men would increase to reflect the potential increase in claims arising from prostate cancer screening.
The second option is to exclude prostate cancers which are deemed to be minor. It is important to note that this change would not mean more current prostate cancer claims being declined. This is the case because prostate cancer diagnosed using current techniques is generally more serious than classification T1.
The key point is that the changes outlined in the second option do not alter the fundamental purpose of the policy for the client. Policyholders will remain protected, as at present, in the event of a serious cancer. A revised definition would still offer clients an excellent policy.
The insurance industry should choose the second ABI option and take the opportunity to reduce one of the risks involved in writing critical illness policies. Where industry action is required, a consensus approach is likely to be the most successful. A new standard cancer definition is the best route to achieve this.
