Angus Macdonald - Academia.edu (original) (raw)

Papers by Angus Macdonald

British Actuarial Journal, 2003

Annals of Actuarial Science, Sep 1, 2007

Scandinavian Actuarial Journal, Jul 1, 2004

Scandinavian Actuarial Journal, Oct 1, 2003

Annals of actuarial science, Mar 1, 2024

Scandinavian Actuarial Journal, Jul 12, 2010

Gui et al. (2006), in Part III of a series of papers, proposed a dynamic family history model of ... more Gui et al. (2006), in Part III of a series of papers, proposed a dynamic family history model of breast cancer (BC) and ovarian cancer (OC) in which the development of a family history was represented explicitly as a transition between states, and then applied this model to life insurance and critical illness insurance. In this study, we extend the model to income protection insurance (IPI). In this paper, Part IV of the series, we construct and parameterise a semi-Markov model for the life history of a woman with BC, in which events such as diagnosis, treatment, recovery and recurrence are incorporated. In Part V, we then show: (a) estimates of premium ratings depending on genotype or family history; and (b) the impact of adverse selection under various moratoria on the use of genetic information.

The North American Actuarial Journal, 2005

In Part I we constructed a model for the development of coronary heart disease (CHD) or stroke th... more In Part I we constructed a model for the development of coronary heart disease (CHD) or stroke that either incorporates, or includes pathways through, the major risk factors of interest when underwriting for critical illness (CI) insurance. In Part II we extend this model to include other critical illnesses, for example, cancers and kidney failure, and describe some applications of the model. In particular, we discuss CI premium ratings for applicants with combinations of some or all of high body mass index, smoking, high blood pressure, high cholesterol, and diabetes. We also consider the possible effect on CI premium ratings of genetic conditions that increase the likelihood of high blood pressure, high cholesterol, diabetes, CHD event, or stroke.

Scandinavian Actuarial Journal, Jun 10, 2013

Genetic studies indicate that the inherited risk of breast cancer is mediated by the well-studied... more Genetic studies indicate that the inherited risk of breast cancer is mediated by the well-studied major genes BRCA1 and BRCA2, and a polygenic component, probably with many genes each making a small contribution. Recently, seven polygenes have been found (Pharoah et al., 2008) contributing an estimated 3.6% of all familial risk (Easton et al., 2007) This suggests that the polygenic component may involve well over 100 genetic loci. We extrapolate these new results into a polygenic model with 147 genetic loci and simulate lifetimes of families to calculate the premium ratings appropriate for a family history of breast or ovarian cancer. We model the adverse selection costs arising from restricting the use of genetic test information in critical illness insurance underwriting in light of new European legislation banning the use of gender for insurance underwriting. In this setting we confirm the overall conclusion of Macdonald & McIvor (2009) that the polygene confers higher adverse selection risk than the BRCA genes. We establish that their three-gene polygenic model does not overly inflate the insurance costs attributable to a polygenic component of breast cancer risk under a model with 147 polygenes.

Astin Bulletin, Feb 16, 2016

The version in the Kent Academic Repository may differ from the final published version. Users ar... more The version in the Kent Academic Repository may differ from the final published version. Users are advised to check http://kar.kent.ac.uk for the status of the paper. Users should always cite the published version of record.

Astin Bulletin, Nov 1, 2006

The UK Biobank project is a proposed large-scale investigation of the combined effects of genotyp... more The UK Biobank project is a proposed large-scale investigation of the combined effects of genotype and environmental exposures on the risk of common diseases. It is intended to recruit 500,000 subjects aged 40-69, to obtain medical histories and blood samples at outset, and to follow them up for at least 10 years. This will have a major impact on our knowledge of multifactorial genetic disorders, rather than the rare but severe single-gene disorders that have been studied to date. What use may insurance companies make of this knowledge, particularly if genetic tests can identify persons at different risk? We describe here a simulation study of the UK Biobank project. We specify a simple hypothetical model of genetic and environmental influences on the risk of heart attack. A single simulation of UK Biobank consists of 500,000 life histories over 10 years; we suppose that case-control studies are carried out to estimate agespecific odds ratios, and that an actuary uses these odds ratios to parameterise a model of critical illness insurance. From a large number of such simulations we obtain sampling distributions of premium rates in different strata defined by genotype and environmental exposure. We conclude that the ability of such a study reliably to discriminate between different underwriting classes is limited, and depends on large numbers of cases being analysed.

Scandinavian Actuarial Journal, Sep 8, 2018

Restrictions on insurance risk classification may induce adverse selection, which is usually perc... more Restrictions on insurance risk classification may induce adverse selection, which is usually perceived as a bad outcome, both for insurers and for society. However, a social benefit of modest adverse selection is that it can lead to an increase in 'loss coverage', defined as expected losses compensated by insurance for the whole population. We reconcile the concept of loss coverage to a utilitarian concept of social welfare commonly found in the economic literature on risk classification. For iso-elastic insurance demand, ranking risk classification schemes by (observable) loss coverage always give the same ordering as ranking by (unobservable) social welfare.

Insurance Mathematics & Economics, Mar 1, 2018

Risks

In this paper, we investigated rates of admission to hospitals (or other health facilities) due t... more In this paper, we investigated rates of admission to hospitals (or other health facilities) due to respiratory diseases in a United States working population and their dependence on a number of demographic and health insurance-related factors. We employed neural network (NN) modelling methodology, including a combined actuarial neural network (CANN) approach, and model admission numbers by embedding Poisson and negative binomial count regression models. The aim is to explore the gains in predictive power obtained with the use of NN-based models, when compared to commonly used count regression models, in the context of a large real data set in the area of healthcare insurance. We used nagging predictors, averaging over random calibrations of the NN-based models, to provide more accurate predictions based on a single run, and also employed a k-fold validation process to obtain reliable comparisons between different models. Bias regularisation methods were also developed, aiming at add...

Estimation of rates of onset of rare, late-onset dominantly inherited genetic disorders is compli... more Estimation of rates of onset of rare, late-onset dominantly inherited genetic disorders is complicated by: (a) probable ascertainment bias resulting from the `recruitment ' of strongly aected families into studies; and (b) inability to identify the true `at risk ' population of mutation carriers. To deal with the latter, Gui & Macdonald (2002a) proposed a non-parametric (Nelson-Aalen) estimate ̂(x) of a simple function (x) of the rate of onset at age x. (x) had a nite bound, which was an increasing function of the probability p that a child of an aected parent inherits the mutation and the life-time penetrance. However if ̂(x) exceeds this bound, it explodes to innity, and this can happen at quite low ages. We show that such `failure ' may in fact be a useful measure of ascertainment bias. Gui & Macdonald assumed that p = 1=2 and = 1, but ascertainment bias means that p> 1=2 and 6 = 1 in the sample. The maximum attained by ̂(x) allows us to estimate a range for the...

We apply a model of Alzheimer’s Disease developed by Macdonald & Pritchard (1999) to the question... more We apply a model of Alzheimer’s Disease developed by Macdonald & Pritchard (1999) to the question of the potential for adverse selection in long-term care (LTC) insurance introduced by the existence of DNA tests for variants of the ApoE gene, the "4 allele of which is known to predispose to earlier onset of AD. We compute the expected present values (EPVs) of model LTC benets in respect of AD for each of 5 ApoE genotypes, weighted average EPVs with and without adverse selection, and sample underwriting ratings. We conclude that adverse selection could increase costs signicantly in a small LTC insurance market only if current population genetic risk is not much smaller than that observed in case-based studies, and if carriers of the "4 allele are very much more likely to buy LTC insurance. Finally, we consider the cost of a combined retirement package, providing both pension and LTC insurance, and show that it can reduce adverse selection.

We present estimates of rates of onset of early-onset Alzheimer’s disease (EOAD) associ-ated with... more We present estimates of rates of onset of early-onset Alzheimer’s disease (EOAD) associ-ated with mutations in the Presenilin-2 (PSEN-2) and Amyloid Precursor Protein (APP) genes. These are based on the Nelson-Aalen method used by Gui & Macdonald (2002a) to build an ac-tuarial model of EOAD and Presenilin-1 (PSEN-1) mutations, but in this case with so little data that we do not attempt to parametrise an actuarial model. It is unclear how the mechanism set up in the United Kingdom — through which insurers can present evidence to the Genetics and Insurance Committee that they should be allowed to use genetic test results for underwriting in certain limited circumstances — should handle mutations for which there is clear qualita-tive evidence of very high morbidity risk, but which are so rare that reliable evidence, in the conventional statistical sense, may be unattainable.

We analyse, in a probabilistic setting, Newcombe’s (1981) life table method of estimating rates o... more We analyse, in a probabilistic setting, Newcombe’s (1981) life table method of estimating rates of onset of high-penetrance single-gene disorders, and extend this to a counting process model for individual life histories, including movement between risk groups arising from genetic testing and onset in relatives. A key result is that estimates of rates of onset at any age x must be conditioned only on information available when subjects were age x, even though their later life histories might be available to the investigator. This determines the data that must be included in pedigrees. We derive a Nelson-Aalen-type estimate of a function of the rate of onset, and show that when all that is known is that the persons in the study inherited a mutation with probability 1/2, the function estimated is bounded. In practice, the treatment of censored observations or the methods of ascertainment might cause the estimate to exceed this bound, which results in infinite estimates of the rate of ...