Problems of price analysis and price comparisons at the retail level in whole life insurance are so complex as to be well beyond comprehension to the average purchaser. In addition to the initial difficulties arising from the combination of savings and insurance protection which exist in whole life insurance policies many variables exhibit influence in the analysis of retail whole life insurance prices. The determination of price is no easy task but is ably accomplished by the level-price method which is utilized in this study. Competition, it is often expressed, should function as a sufficient deterrent against the charging of excessive prices. From economic theory the concept of effective competition dictates that prices need not be completely uniform but that they ought not to exhibit substantial diversity and that they should be flexible. The flexibility of prices in whole life insurance is restricted, by the nature of the product, to changes on an annual basis. Evidence from this study, based on 1967 data, indicates that substantial price disparity between different companies is existent in various types of whole life insurance policies offered in Canada. Competition however, operates as well on variables other than price. The extent to which the existent price disparity reflects the costs of the added variables is not completely clear. While this study only views the price competition situation at one point in time, and is therefore restricted from the advantages of conclusions based on broad foundations in time, it nevertheless appears evident that while no conclusions can be made here on competition as a whole, competition on the basis of price alone is less than wholly effective. / Business, Sauder School of / Graduate

The Canadian life insurance industry has been undergoing constant market and product changes since 1950. This study is meant to identify, analyze, and document those economic and social factors that have influenced the growth and decline in sales of ordinary; group and industrial life insurance. The method by which each of these products is marketed is also examined. Much of the information used was obtained through a series of comprehensive interviews with the personnel of a number of life insurance companies. Many factors have been isolated as having a significant impact on the sales of the various forms of life insurance. Many of these factors were identified principally from current literature in the particular field and tested by means of a correlation and regression analysis. The study found that sales of ordinary life insurance in force has declined from 73.82 percent in 1950 to 52.79 percent in 1969. Applying net new purchases as the unit of measurement it was found that ordinary life sales have decreased from 74.76 percent in 1950 to 60.16 percent in 1969. Net new premium was decided upon as the most relevant unit of measurement for this study. Net new premium income for ordinary life increased from 80.34 percent in 1950 to 81.85 percent in 1969. It was also found that marriages and the number of full time life insurance agents have had a significant impact on ordinary life sales over the past 20 years. Industrial life sales in force declined from 9.76 percent in 1950 to 0.60 percent in 1969. Net new purchases of industrial life declined from 8.94 percent in 1950 to 0.045 percent in 1969. It was found that net new premium income dropped from 13.46 percent of the total premium income to 0.01 percent in 1969. The decline has been a reflection of the growth in group life policies, and the increased affluence of the blue collar worker who can now afford ordinary life policies. Group life insurance sales have grown at an astonishing rate. In 1950 group life insurance in force accounted for 16.40 percent of the total life insurance in force. By 1969 the figure had climbed to 47.10 percent of the total amount in force. Net new purchases of group life policies over the same period jumped from 13.50 percent in 1950 while 18.12 percent of the total premium income in 1969. It was also found that gross national product, total employment, and the number of federally registered life insurance companies have each had a significant impact on the aggregates sales of group life over the past 20 years. / Business, Sauder School of / Graduate

This thesis addresses the complex issue of risk classification in the field of insurance. Prior to accepting risks, insurance companies must first be able to evaluate those risks. Accordingly, they seek to collect the most information possible from, amongst other sources, the insured, so as to gage relative risk and evaluate whether to insure or not, to what degree and at what rate. In due course, the insurer will use this information on conjunction with statistical and actuarial calculations to draw hypotheses on the degree, probability and cost of risk. In selecting relevant risks for analysis, insurers will utilise set variables based on the area of insurance in which they operate. However, said variables are highly susceptible to being discriminatory. Notably, one thinks of sex and age which are contentiously considered by practitioners and scholars whether or not they operate in the field of insurance. This dissertation will examine exhaustively the normative framework in place in order to determine to what degree, if indeed at all, insurers can legitimately and legally utilize certain classifications such as age and sex in order to select, categorise and fix the price for the various risks offered to them. / The question shall arise, to what degree less or all-together non-discriminatory criteria should be favoured over criteria, sometimes considered, prohibited. In order to answer all these questions to better address the issue, we must first examine certain essential notions of insurance. Thus, in the first section, we will describe the relevant logistic practices in insurance industries. We shall focus on the decision process at various levels where potential discriminatory practices may arise. We will see that certain schools of thought on insurance classification are at odds, some times diametrically. We will, incidentally, favour the 'fair discrimination' doctrine over its traditional theoretical rival: 'anti-discrimination'. Our research shows that potentially discriminatory classification occurs at several stages of the ex ante and ex post contractual relationship, stages we will examine one at a time. In the second portion we will cover the general juridical regime of the right to non-discrimination in contracts at the international, national and provincial levels. Special attention will be paid to specific rules which allow some limited derogation to the constitutional rights against discrimination. We shall highlight that the legislative authority granted by the Quebec Charter does have limitations. What's more, certain guidelines recently established by the Supreme Court of Canada regarding application, must take precedence over various classification criteria pertaining to insurance which find their root in article 20.1 of the Quebec Charter. Ultimately, we will concentrate on what is just, which is to say the legitimacy of discrimination in a field that takes it for granted while seldomely questioning its foundations. We will come to apply a new measure for insurance discrimination. We will test this new measure in two specific fields: life insurance and automobile insurance. Overall, this thesis will allow us to determine how discriminatory classification can, at times, be legally employed (mostly in pre-selection and segmentation) in the above mentioned fields. We will conclude by proposing a new operating model which seeks to limit classification procedures that circumvent rights to privacy and non-discrimination.

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