Casualty Actuarial Society Announces Four Free DEI Research Papers On Racial Bias And Insurance Pricing

On March 9, 2022, the Casualty Actuary Society (“CAS”) announced that, pursuant to its board of directors’ directions, it had commissioned a series of four free research papers exploring diversity, equity, and inclusion (“DEI”) in the insurance industry from an actuarial perspective. Two of the four papers in the series are now available on the CAS website and the remaining two papers will become available at the end of March.

In announcing the publications, CAS’ chief executive officer, Victor Carter-Bey, D.M., stated that:

“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.”

Agency Checklists agrees with CEO Carter-Bey, as outlined below, these are papers that add important DEI perspectives to insurance pricing and underwriting practices.

Two papers already published and two more scheduled for publication

The first paper CAS has published is a twenty-six-page research paper entitled “Methods for Quantifying Discriminatory Effects on Protected Classes in Insurance.” This paper has four sections covering the following topics:

Section 1: Background — conditions of unfair discrimination in society and how it has impacted the property and casualty insurance industry

Section 2: Accusations of Bias in Insurance — description of challenges being made to insurance rating, underwriting and claims practices

Section 3: What is Unfairly Discriminatory? — definition of unfair discrimination, including statutory, regulatory, and actuarial guidance on unfair discrimination in insurance

Section 4: Approaches Measuring and Mitigating Discriminatory Effects on Protected Classes — explanation of data science methods that have been developed for measuring and controlling bias in models, and how these methods can be applied to actuarial and other insurance predictive models

The paper’s first ten pages are interesting and accessible to anyone who would want an overview of some issues of racial bias in insurance. The remainder of the paper would probably only appeal to those who are interested in the statistical underpinnings of racial bias and how actuaries might mathematically minimize its effect.

This paper is available at the CAS with this link: “Methods for Quantifying Discriminatory Effects on Protected Classes in Insurance.

The second publication offers a primer on historical racial bias in some financial services

The second twenty-five-page research paper published by CAS is entitled “Approaches to Address Racial Bias in Financial Services: Lessons for The Insurance Industry” is more general and historical.

The stated goal of this paper is “[T]o equip actuaries to proactively participate in discussions and actions related to potential racial biases in insurance practices.“

While ostensibly directed at actuaries, this paper is written in a non-technical and instructive way that makes it a useful primer for anyone who is interested in the issues of racial justice in the financial service industries.

This paper presents for readers working in the insurance industry historical examples of racial bias and present-day attempts to mitigate such bias from four financial service areas outside the insurance industry:

  • mortgage lending.
  • personal lending.
  • commercial lending; and,
  • credit-scoring systems

This paper is available on the CAS website at this link: “Approaches To Address Racial Bias in Financial Services: Lessons for the Insurance Industry.”

Two additional papers on racial bias in insurance are due for publication this month

The two remaining publications of the four-part series are scheduled for publication on March 31, 2022, per the CAS announcement.

The third publication has the title: “Defining Discrimination in Insurance.” 

According to the CAS announcement this paper will address the historical use and inconsistent meanings given by different stakeholder in the insurance industry to terms such as:

  • Protected class.
  • Unfair discrimination
  • Proxy discrimination
  • Disparate impact
  • Disparate treatment: and,
  • disproportionate impact.

The fourth and final publication in this series is “Understanding Potential Influences of Racial Bias on P&C Insurance: Four Rating Factors Explored.”

The announcement for this paper states that it “examines four commonly used rating factors in personal lines insurance – credit-based insurance score, geographic location, home ownership, and motor vehicle record – to understand how the data underlying insurance pricing models may be impacted by racially biased policies and practices outside of the system of insurance.”

About the Casualty Actuarial Society (CAS)

The Casualty Actuarial Society (CAS) is a leading international organization for credentialing and professional education. Founded in 1914, the CAS is the world’s only actuarial organization focused exclusively on property and casualty risks and serves over 9,500 members worldwide. Professionals educated by the CAS empower business and government to make well-informed strategic, financial, and operational decisions. Learn more at

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