Changes
==Objective==
* To perform sensitivity analysis and qualitatively determine the variation in monthly premium charged by the life insurance companies.
'''Ratings of the Life Insurance companies considered'''
* In AIG, monthly premium for men who smoke more than 1 pack of cigarettes a day remains constant at $413 in all health classes.
* In AIG, monthly premium for women who smoke more than 1 pack of cigarettes a day in the Best health class is $219 which increases by 34% to $294 for all other health classes.<br>
==Key Findings==
* The first level of segmentation in Life Insurance industry is on the basis of Age and Gender. Then they are further segmented on the basis of their health class and thereafter on the basis of their smoking habits.
* It is noteworthy that although the companies charge less premium for women than men, the increase in premium as the health class shifts is higher for women than men. This is an indication that the companies maintain a policy of high risk averseness for women as their health class goes down.
* Companies consider Best and Preferred health class customers in the same segment as the premium charged is same for both these classes.
* Transamerica charges low premium across all categories of health classes. So we can say that they are trying to tap the major chunk of the market by competitive pricing strategy.
* Pruco (Prudential) charges the lowest premium for nicotine patch users. Hence, it may be concluded that the company is aggressively trying to dominate this segment.
* AIG and Genworth charges least premium for Best and Preferred health class individuals falling under non-smoking category while they charge relatively higher premium for all the smoking sub-categories. This shows that these companies are targeting non-smoking category and are risk averse in nature.
==Constraints==
* This study incorporates only five insurance companies because of the constraint of data availability.
* The study is limited only to the state of California; however, we observed that the premium charges in other states are similar to that of California.
