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Mathias Millberg Lindolm: Discrimination-Free Insurance Pricing

Time: Wed 2020-04-15 15.15 - 16.15

Location: Zoom, Meeting ID 252-099-376

Participating: Mathias Millberg Lindolm, Stockholms unversitet


We consider the following question: given information on individual policyholder characteristics, how can we ensure that insurance prices do not discriminate with respect to protected characteristics, such as gender? We address the issues of direct and indirect discrimination, the latter meaning that we can learn protected characteristics from non-protected ones. We provide rigorous mathematical definitions for direct and indirect discrimination, and we introduce a simple formula for discrimination-free pricing, that avoids both direct and indirect discrimination. Our formula works in any statistical model. This will be illustrated numerically using both simple and complex models. An important conclusion is that discrimination-free pricing in general requires collection of policyholders’ discriminatory characteristics, posing potential challenges in relation to policyholder’s privacy concerns. If time allows, I will also discuss connections between discrimination-free pricing and causal inference.

This presentation is based on joint work with R. Richman, A. Tsanakas, M.V. Wüthrich, see the pre-print available at: