Information Matrix

We have written extensively about the use of postcodes and geodemographics for mortality modelling.  Two peer-reviewed papers recently presented to the Institute of Actuaries in London have testified to the power of geodemographics when applied to pensioner mortality: Richards (2008) and Madrigal et al (2009).

We have written previously about the importance of the independence assumption when modelling mortality for annuities and pensions. In a recent presentation to the Royal Statistical Society I showed the audience how life insurers deduplicate their annuity data and how they use postcodes to identify socio-economic status.

A phenomenon to watch for is that of the "self-prophesying model".  It occurs when a variable is too specific to the mortality experience of a reference portfolio to have wider application. 

Following my entry on postcode profiling, I have been asked two further questions. The first is whether you have to use Experian's Mosaic system.

There is some degree of confusion over what people mean by "postcode" when applied to modelling mortality in the United Kingdom. There are varying ways of using postcodes, depending how much of the full postcode is actually used.