Additional Information on Life Insurance Mortality Charges
GGD-88-120FS, Aug 8, 1988
Pursuant to a congressional request, GAO provided information on the mortality assumptions and charges in 40 life insurance policies, which were filed in the District of Columbia and Maryland, to determine the effects of a District law prohibiting insurers from discriminating against persons infected with Acquired Immune Deficiency Syndrome (AIDS).
GAO found that: (1) of 17 policies filed in the District before enactment of the anti-discrimination law, 2 had maximum mortality charges which exceeded 10 times the standard mortality; (2) 1 of the 23 policies filed after the law's enactment had a maximum mortality charge exceeding 6 times the standard mortality; and (3) the majority of policies filed before or after the law's enactment had maximum mortality charges of less than 2 times the standard mortality. GAO also found that: (1) the 40 policies were also filed with Maryland, which does not have an AIDS anti-discrimination law; (2) 39 of these policies had the same mortality assumptions as the District policies; and (3) the remaining policy had a Maryland mortality assumption of 1.18 times the standard mortality, as opposed to the District mortality assumption of 1.23 times the standard mortality charge.