Numerical method of underwriting

The numerical rating method is a systematic method of measuring each of the major factors which influence the mortality by means of debit for a factor which is unfavorable and credit for one which is favorable.
The rate of mortality of substandard life is obtained by adding to the basic mortality rate appropriate to standard lives.

e.g: Consider a group of 1000 lives aged 40, suffering from high blood pressure.
Suppose it is observed that over a year actual number of deaths for this group is 25.
Suppose for a normal group of 1000 lives aged 40, the expected number of deaths over a year is 10.
The group with high blood pressure is experiencing 15 extra deaths over anc above the expected deaths of standard group.
The extra mortality rating (EMR) in this case will be:
= Extra deaths x 100 = 15 x 100 = 150%
Expected deaths 10
It is found that certain impairments such as high blood pressure or persona-history of heart disease, the extra risk relative to the standard risk increase? as age increases.

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