Underwriting Cannabis - White Green Paper

AN APPLICATION OF PREDICTIVE ANALYTICS IN LIFE INSURANCE USING PRESCRIPTION DRUGS INFORMATION

Optimum Re has reviewed Milliman’s IntelliScript's Risk Score, which is a proprietary algorithm developed by Milliman using an individual’s prescription drug history information to calculate a Risk Score as a predictor of future mortality.
Based on more than 25 million Life, Health, DI, LTC, Final Expense and Medicare Supplement insurance applications, Optimum Re confirms Risk Score is a good predictor of future mortality: the observed mortality increases as the Risk Score increases.

Such algorithm may be used by insurance companies to replace traditional underwriting requirements by such predictive model. Optimum Re may assist insurance companies who wish to validate the predictability of Risk Score results
on their own portfolio by performing a retroactive analysis and by guiding them in setting their mortality assumption.

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