Actuarial science vs. Neuroscience

I get interviewed by a lot of newspapers, magazines and TV stations, but maybe the most interesting one came last year when I spoke to David Scharfenberg of the Boston Globe about neuroscience and actuarial science.

David’s article looks at the criminal justice system and suggests that people under the age of 25 should be classified and punished differently from people older than that. Their young-ish minds aren’t fully developed.

He points to scientific studies and programs, but he wanted to talk to me about insurance. The I.I.I., of course, has no opinion on criminal justice, but famously, auto insurers charge younger drivers more than older drivers, and the rates generally change about age 25.

From the article, here is what I said:

The insurance industry’s decades-old imposition of higher rates on young adult drivers is . . . rooted in hard numbers.

The data show a significant decline in the number of accidents for drivers over the age of 25, because they’re more experienced and more mature. And property casualty insurers — more than 2,000 in all — have to retest that proposition year after year, in order to justify the elevated rates to state regulators.

“It’s like, ‘OK, here we are in Arkansas — well, looks like we’re going to be drawing the line at 25, 26 again,’ ” Lynch says. “Now, we’re looking at Massachusetts — oh, there we are again.” The industry, he says, has known for decades what the white coats in the lab are now confirming.

“We were there,” he says, “long before the neuroscientists.”

Postscript: This article was actually published in November, but I only heard about it in mid-January when a prisoner at a correctional center in Massachusetts asked for more information. I sent him this link from our Facts and Statistics page.

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