Premium rates based on genetic studies: How reliable are they?

Underwriting the risk of rare disorders in long-term insurance often relies on rates of onset estimated from quite small epidemiological studies. These estimates can have considerable sampling uncertainty and any function based upon them, such as a premium rate, is also an estimate subject to uncertainty. This is particularly relevant in the case of genetic disorders, because the acceptable use of genetic information may depend on establishing its reliability as a measure of risk. The sampling distribution of a premium rate is hard to estimate without access to the original data, which is rarely possible. From two studies of adult polycystic kidney disease (APKD) we obtain, not the original data, but the cases and exposures used for Kaplan–Meier estimates of the survival probability. We use three resampling methods with these data, namely: (a) the standard bootstrap; (b) the weird bootstrap; and (c) simulation of censored random lifetimes. Rates of onset were obtained from each simulated sample using kernel-smoothed Nelson–Aalen estimates, hence critical illness insurance premium rates for a mutation carrier or a member of an affected family. From 10,000 such samples we estimate the sampling distributions of the premium rates, finding considerable uncertainty. Very careful consideration should be given before using small-sample epidemiological data to deal with insurance problems.