CAS Releases Reports on Race and Insurance Pricing
The Casualty Actuarial Society (CAS) has started to release multiple reports on racial bias in insurance pricing.
“The CAS is proud to move forward with not just a commitment to diversity, equity and inclusion in all aspects of actuarial work, but with research that tackles the issue on a quantitative level,” said Victor Carter-Bey, CEO of CAS, in a statement. “These papers are an important contribution to the conversations that are taking place in the insurance industry to address the potential implications of racial bias in insurance pricing. We want our unique and valuable actuarial perspective to help further and enhance those conversations.”
The first two research papers are now available on the CAS website. Two others will be released March 31, CAS said.
“This research helps lay the groundwork for CAS members and other stakeholders to become aware of the discussions taking place around this topic and the potential impact on the work that actuaries do,” said Roosevelt Mosley, CAS president-elect, co-author of one of the papers and a principal and consulting actuary with Pinnacle Actuarial Resources. “Actuaries’ expertise in insurance pricing and our extensive training, from analytical skills to deep industry knowledge, allow us to contribute in quantifying and explaining the issues moving forward.”
In “Methods for Quantifying Discriminatory Effects on Protected Classes in Insurance,” Mosley and co-author Radost Wenmen examined approaches to defining and measuring fairness in predictive models. It provides an overview of bias mitigation techniques that can be performed during the input, modeling or output phase of a model, once a set of fairness criteria has been adopted.