The conversion of whole life extras into extra premiums for other classes of assurance.

A problem of occasional practical importance is to find the extra premium for a particular class of policy, which corresponds to an extra premium fixed by the Medical Officer for a standard class of policy, here assumed to be whole life. Except when the extra mortality can be assessed by a simple ‘rating up’ of the age of the assured, this problem is not easily solved. The direct calculation of the required extra premium from specially constructed mortality tables would be very laborious, particularly in view of the necessity to reproduce the given whole life extra. In the following note a procedure is developed which provides in the circumstances mentioned and without undue labour, an extra premium for any class of policy once it is decided whether the extra risk is of increasing, constant or decreasing type. A few examples illustrate how the method may be applied in practice.