Morbidity Rate

What Does Morbidity Rate Mean?

The morbidity rate is a statistical measure indicating how many individuals in a population are affected by a disease and how frequently it occurs within a specific area and time frame. Insurers rely on this figure to calculate premium rates for health and life insurance policies.

Insuranceopedia Explains Morbidity Rate

The morbidity rate is expressed as a percentage and is calculated by dividing the number of individuals affected by a disease (numerator) by the total number of individuals at risk (denominator). For instance, if 10,000 men aged 30 and older are diagnosed with prostate cancer out of a population of 20,000 (excluding men under 30 and females), the morbidity rate would be 50%.

Insurers use morbidity rates to determine premium prices for insurance policies, particularly health and life insurance. Higher-morbidity applicants, like older adults or people with chronic conditions, pay more than younger or healthier ones, which is one of the main factors that impact the cost of a life insurance premium. The size of that gap shows up in the average cost of life insurance data, where premiums rise steeply with age.