Article Title

A Crisis in Insurance


Benjamin Lipson


As the life and health insurance industry evaluates its long-term financial goals, the cloud of Black Monday — October 19, 1987, the day the stock market collapsed — blurs its cherished investment income projections. With investment portfolios under siege, mutual life insurance companies and stock companies alike are wary of making policy-pricing miscalculations that could prove to be disastrous. As if that weren't enough, one single disease — acquired immunodeficiency syndrome — looms as the most serious threat to life and health insurers for the remainder of this century. The spread of the new disease has caused insurers to adjust their underwriting requirements by insisting on tests for the AIDS antibody as a precondition for obtaining insurance. Increasingly, life insurance companies are prepared to curtail the availability of insurance in states that place restrictions on testing for insurance purposes. There are also important privacy issues that must be adequately addressed if systematic abuse ofthe individual's right to privacy is to be avoided.



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