Average

Truthfully this basic mathematical concept has gotten us into more trouble than we have ever acknowledged. On which side of justice do you wish to fall? In the case of chronic illness risk, average or even median numbers can be very skewed and seriously misleading. We do however have to have a target to try to accommodate. The real problem all along has been the nature of the risk itself. You must be disabled to qualify, but you must be healthy to buy. We have never come to grips with all the time in between. All those years of virtually non existent claims have played havoc with our thinking. Please take a moment and carefully review this long term care claim occurrence chart. It looks like an inverted alpine ski jump, with relatively level cross country skiing before rapid acceleration as you begin a blast off into claims in your late seventies ending with the universally required jump of faith into the hereafter. Where is the middle of this? And even if you were to arbitrarily choose one, what would it mean?

Click here to read more, originally published in the April 2019 edition of Broker World Magazine.