The Economist UK - 03.08.2019

12 The EconomistAugust 3rd 2019

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Letters

Insuring for a healthy life

Your article on innovation in

insurance (“Run for cover”, July

20th) did not touch on a funda-

mental transformation that is

taking place across the life-,

health- and motor-insurance

markets, namely incentivising

customers to be healthier and

to make better choices. This

acknowledges that the nature

and treatment of risk has

shifted, from pre-existing risk

to risk driven by behavioural

factors. Some 60% of mortality

and 80% of the global disease

burden are a function of just

four lifestyle choices—lack of

exercise, poor nutrition, smok-

ing and alcohol abuse—which

lead to major non-communi-

cable diseases.

This new approach to risk

allows companies to share the

gains resulting from healthier

choices with their customers,

by funding valuable incentives

and lowering premiums, creat-

ing a shared-value loop. It has

also created a more profound

role for insurers: not only

providing protection against

adverse events, but helping

make society healthier.

adrian gore

Group chief executive

Discovery Vitality

Johannesburg

Insurance companies are

indeed clueless about the most

recent advances in climate and

weather modelling, even

though the risks they cover are

“becoming more severe and

unpredictable.” But because

insurers usually offer short-

term contracts this problem is

of only minor importance to

their business at this point. It

does pose more complex chal-

lenges for governments, prop-

erty owners and lenders, who

are in it for the long-term.

You also lauded the

innovation of “parametric

insurance”, where polices pay

out when clearly defined

parameters, such as rainfall

threshold, are reached. But the

evidence suggests that when

insurers tried to sell these

parametric products (initially

for crops in low-income coun-

tries), the take-up was very low,

even when premiums were

subsidised. Still too often,

parametric insurance is akin to

a lottery ticket, as basis risk—

the lack of correspondence

between the parametric trigger

and experienced damage—is

high. Risk modelling needs to

improve before many of these

products should be sold.

ilan noy

Chair in the economics

of disasters

Victoria University of

Wellington

Wellington, New Zealand

A giant in computing

Alan Turing did not build

Colossus, an electronic digital

computer that made a big

contribution to breaking the

German Lorenz cipher in the

second world war (“Due credit”,

July 20th). That acclaim should

go to Tommy Flowers. He got

no public recognition at the

time and has had precious

little since. Flowers was born

to a working-class family in

Poplar, a poor part of east

London. He was educated

through an apprenticeship and

by taking night classes at the

University of London. He

deserves to be remembered for

his achievement.

donald neal

Hamilton, New Zealand

Colombia’s cocaine problem

“Blow up” (July 6th) reported

on Colombia’s expanded coca

cultivation and the govern-

ment’s poor options for dealing

with it. This illustrates only too

clearly the curse that the un

drug conventions and their

enforcement by America in its

war on drugs have cast upon

the country. There is a case that

Colombia’s guerrilla move-

ments would have made peace

in the early 1990s had it not

been for the cocaine revenues

that gave the farcample

means to carry on. Now, ironi-

cally, a surge in coca cultiva-

tion, that is in part a perverse

result of that peace process, is

fuelling a recrudescence of

violence in the coca-growing

areas that the farcabandoned.

Other countries should give

Colombia time to reduce pro-

duction and support its efforts

in tracing assets and disrupt-

ing flows of cash, cocaine and

precursor chemicals, which

can be just as effective as crop

eradication. In Bogotá there are

concerns that American impa-

tience might lead the adminis-

tration to decertify Colombia

for its slow progress. This was

tried in the mid-1990s. It suc-

ceeded in getting Colombia to

reintroduce extradition but

also contributed to a dramatic

increase in coca cultivation

and paramilitary violence.

There could not be a worse

time for a repetition of that,

with the peace process at such

a delicate stage. And Colombia

is America’s key ally in dealing

with the Venezuelan crisis.

sir keith morris

British Ambassador to

Colombia, 1990-

London

Planning for the future

Scenarios should radically

challenge conventional think-

ing, rather than just sound

crazy, as the leader accompa-

nying The World If suggests

(“Navigating the rapids”, July

6th). At the Oxford Scenarios

Programme, we argue that the

value of scenarios lies in the

actions taken as a consequence

of thinking through a small set

of alternative possible futures,

which cannot be dismissed as

crazy, and instead have

sufficient connection with

reality to pose credible

challenges to current thinking.

What may appear crazy to one

member of a team is reason-

able to another. What matters

is making sense of the

apparent strangeness or

incompatibility of contrasting

and different perspectives to

help leaders navigate

turbulence.

Good scenarios are thus

honed for a specific user, use,

and purpose. Rigorous theory

and method guide the use of

these scenarios and help

executives go beyond respond-

ing to things haphazardly.

rafael ramirez

cho khong

trudi lang

cynthia selin

Faculty

Oxford Scenarios Programme

Thanks for the annual summer

brain exercises in The World If.

Reading about future fore-

casting reminds me of Isaac

Asimov’s early novel,

“Foundation”, in which a

mathematician discovers the

future. A lesson can be derived

from this book: the mathema-

tician refuses to share his

findings because by doing so it

would modify, and potentially

annihilate, his predictions.

In other words, by sharing a

handful of speculative scenari-

os, you may have changed the

course of history.

christophe cauvy

Oxford

The future is not always conve-

niently packaged. Around 1990

Bell Laboratories conducted a

survey among its most

insightful prognosticators

regarding the most significant

communications technologies

that would lead us into the

millennium. isdnmade the

list; the internet did not. As

Yogi Berra (may have) said, it’s

tough to make predictions,

especially about the future.

hans mattes

Petaluma, California

The at-odds couple

The parents of the students

who refused to take Trump

supporters as roommates

should be asking for their

tuition back (“Strange bed-

fellows”, July 20th). The core

skill of an educated person is to

be able to listen to an opposing

view, engage with it, find com-

mon ground if possible, learn

from it and respect it. By reject-

ing Trump supporters, these

students mimic his behaviour

by gleefully rejecting anyone

who disagrees with them.

My second thought after

reading the article, is where

can I find an apartment for

$625 a month?

peggy troupin

New York