NEW YORK–As the percentage of elderly in the U.S. population continues to bulge, insurers may wish to provide large-type policies for older motorists and test them to see if they still have the ability to drive, an economist suggested.
Those were just a few of the points raised by Steven Weisbart, Insurance Information Institute vice president and chief economist, in a talk here last Thursday on "The Effect of the Aging Population on the Property-Casualty Insurance Industry."
Mr. Weisbart's study of the impacts and issues that could surface as the baby boom generation moves into its retirement years was delivered to the Nineteenth Annual Executive Conference for the Property-Casualty Industry, put on by the National Underwriter Company and additional sponsors.
Among the figures he noted was that by 2025, the number of people in the 85-and-older bracket is projected to be eight million–the same as there are today in the 70-to-75 age group.
Possible good news cited by Mr. Weisbart was the finding that currently people age 65 and above have a more positive attitude towards the auto insurance industry. Mr. Weisbart said it might be reasonable to assume that younger people will morph into that frame of mind as they grow older.
Auto insurers in the future will have to deal with an increasing number of drivers who are staying on the road well into their 80s. With older drivers, said Mr. Weisbart, underwriters will have to look at additional factors.
He warned that higher accident levels for the elderly do not correlate with moving violations. Increased mileage by the elderly, Mr. Weisbart added, might be linked to better health and higher income, and it might come with living in areas without alternate transportation.
A factor that might reduce mileage, he said, could be that as more elderly are without guaranteed pensions, they may drive less because of the cost involved.
Examining auto accidents, Mr. Weisbart noted that bodily injuries increase after age 60, while the death rate for drivers age 70 and above soars–possibly because they are more frail.
The economist said that among possible questions that the data on the elderly suggest:
o Will seniors not buy more expensive cars?
o Will their income levels keep them from maintaining their cars in safe condition?
o Will insurers want to offer alternative transport services?
o Will underwriters create tests of driving ability for the elderly?
o Will insurers add a surcharge if an insured refuses to take the test?
Further, Mr. Weisbart wondered whether the elderly might want more handholding with the claims process or prove more litigious.
Insurers, he suggested, might want to provide older clients with policies written in bigger type and special phone centers.
Automakers, he said, might build cars tailored to be age-friendly, while employers might redesign workplaces to minimize accidents that could prompt workers' compensation claims.
Because statistics show the elderly have more trouble making left turns, governments may wish to fund improvements to make them easier to negotiate, suggested Mr. Weisbart.
He noted the figures showing longer injury recovery times for the elderly will mean that workers' comp insurers will face longer indemnity claims. Additionally, Mr. Weisbart, cited statistics that the death rate for workers age 65 is triple that for those aged 35-to-44.
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