Applying Fairness Frameworks to Long-Term Care Insurance: Actuarial Considerations for AI and a Pricing Example
May 1, 2026
Authors
Hong Beng Lim, ASA, PhD
Mengyi Xu, FSA, FIAA, PhD
Kenneth Q. Zhou, FSA, ACIA, PhD
Sponsor
Society of Actuaries Research Institute
Summary
This report examines how fairness-oriented modeling techniques, widely discussed in data science and emerging actuarial research, can be adapted to long-term care insurance (LTCI) pricing. It provides a structured overview of fairness methodologies. The study helps to evaluate potential fairness adjustments in an LTCI pricing framework.
Key Components
- Executive Summary and Introduction
- Fairness Frameworks and Actuarial Considerations
- Applying Post-Processing to LTCI Pricing
- Areas of Discussion
- Appendices on framework, details on pricing methods, etc.
What are the key considerations when applying a fairness framework for LTCI?
The study’s goal is to inform the actuarial community about fairness approaches discussed in recent research and to illustrate, through a practical example, how a fairness adjustment developed in other modeling contexts could be incorporated into LTCI pricing workflows. The findings are intended to support future discussions on how fairness methods can complement traditional actuarial methods and inform ongoing research in insurance design.
Report
Suggested Citation
Lim, Hong Beng, Mengyi Xu, and Kenneth Q. Zhou. Applying Fairness Frameworks to Long-Term Care Insurance: Actuarial Considerations for AI and a Pricing Example. Society of Actuaries Research Institute, April 2026. https://www.soa.org/resources/research-reports/2026/fairness-ltc-insurance-ai/
Acknowledgements
The authors’ deepest gratitude goes to those without whose efforts this project could not have come to fruition: the volunteers who generously shared their wisdom, insights, advice, guidance, and review of this study prior to publication. Any opinions expressed may not reflect their opinions nor those of their employers. Any errors belong to the authors alone.
Project Oversight Group members:
Henry Chen, ASA, MAAA
Robert Eaton, FSA, MAAA
Rachel Erne, FSA, CERA, MAAA
Patricia Fay, FSA, MAAA
Sean Hilton, FSA, MAAA
Min Ji, FSA, FIA, MAAA
Eileen Luxton, FSA, FCIA
David Schaub, FSA, CERA, MAAA, AQ
At the Society of Actuaries Research Institute:
Lisa A. Schilling, FSA, EA, FCA, MAAA, Director, Practice Research
Barbara Scott, Senior Research Administrator
Questions or Comments?
Give us your feedback! Take a short survey on this report. Take Survey
If you have comments or questions, please send an email to Research@soa.org.