Genre: What Zika means for you and your clients

Zika Virus Outbreak – What Does It Mean for Insurers?

Issue: March 2016 | Life | By Tim Eppert, Senior Pricing Actuary, Cologne

In February 2015 the Ministry of Health in Brazil investigated and later confirmed an outbreak of Zika virus that has since then spread rapidly through Latin America. Infection with Zika commonly causes very mild symptoms but this outbreak has created global news headlines and prompted some startling reactions. The WHO declared a global public health emergency, Brazil deployed 200,000 troops to battle mosquitos and women across Latin America were advised to postpone pregnancy.

A link is suspected between the occurrence of Zika in Brazil and an apparent increase in microcephaly reported amongst newborns. Microcephaly is a devastating condition that means babies are born with smaller heads and brains than normal, leading to significant developmental problems.6 The association with microcephaly raises concerns that infection with Zika virus may be significantly more harmful than has been suspected to date.

The Ministry of Health in Brazil projected between 440,000 and 1.3 million Zika infections in 2015. The WHO estimates 3 to 4 million people in the Americas might become infected during 2016.7 More recent modelling concluded that during this first wave of Zika, 1.1 million pregnant women may be affected and 64 million infections in total could occur in the Americas.8

Zika virus – a short history
Zika, a virus related to Dengue and Yellow fever, was first isolated in humans in 1952. The mild symptoms associated with infection – fever and skin rash – brought it comparatively little media attention.9 The largest outbreak to date, in French Polynesia in 2013, was associated with neurological complications, and a retrospective analysis revealed a related increase in birth defects.

The virus is spread mainly by bites from infected female mosquitos of the subtype Aedes – in particular, Aedes aegypti. Zika could spread to all areas where these insects are found, including most of South America, southern parts of the U.S., Southern Asia, Southern Europe, the northern parts of Oceania and most of Africa. It has been suggested that Zika arrived in Brazil with visitors to the FIFA World Cup in 2014, and movement of people for the Olympic Games later this year may contribute to the virus spreading further. Human-to-human transmission via sexual contact has been reported, leading several health authorities to issue advice about safe sex.

What are the risks?
The main concern in the recent outbreak has been for pregnant mothers passing the virus to their unborn children. While there is no definite proof – yet – that Zika causes microcephaly, doctors have isolated the virus in foetal brain tissue and can explain how it damages the brain of an unborn child.14,15

No relevant increase in microcephaly has been reported in African and Asian countries where the virus has been present for decades. By contrast, the rise in suspected cases in Brazil is dramatic – more than 20 times normal and affecting between 4.5% and 8.9% of all births in the most affected regions.16 The fact that the outbreak is still active means a further increase in cases of suspected microcephaly in Latin America is to be expected. Once the disease is “established” in South America, the numbers of microcephaly will decrease again, as prior contact with the virus will lead to immunity in future pregnancies.

Zika infection is also linked with Guillain-Barré syndrome, a neurological disease that causes the body’s immune system to attack the peripheral nerves. Guillain-Barré can cause muscle weakness and life-threatening paralysis in the acute phase if breathing muscles are affected. It is fatal in 5% of cases and about 20% of people affected remain severely disabled despite treatment.

French Polynesia experienced a 20-fold increase in Guillain-Barré cases during the 2013 Zika virus outbreak. Although several Latin American countries currently report a rise in Guillain-Barré, even if the 2013 situation is replicated, the absolute numbers will be limited as the normal incidence is very low (less than two per 100,000 person years in Western countries). An increase in other neurological syndromes, such as meningitis, was also observed in French Polynesia, but no such increase has been reported in the current outbreak.

How solid are the numbers?
While the reported numbers of microcephaly are reason enough to react, the magnitude of threat is under debate. Brazil only introduced mandatory reporting of all suspected microcephaly last year so a certain increase in cases is not surprising. The heightened concern about microcephaly and Zika virus may have led to over-reporting.

There are differing definitions of microcephaly measured by head circumference. Brazil initially set a limit below 33cm and later below 32 cm (plus a certain deviation from the average circumference for a specific gestational age). Data on head circumference of babies without congenital malformation show that around 7% of all new-borns in Brazil measure below 32 cm without any impact from Zika virus.20 A major risk factor for a small head circumference in otherwise healthy babies is premature birth.

A March 2016 update by the Brazil Ministry of Health covers cases reported, based on revised maximum head circumference standards for potential microcephaly (31.9 cm for boys and 31.5 cm for girls). The standards were revised following recommendations from the World Health Organization (WHO). Between October last year and March 2016, there were 6,158 potential microcephaly cases, out of which 1,182 were ruled out. In 745 cases of microcephaly (and other nervous system disorders) suggestive of congenital infection, 88 are confirmed related to Zika virus. A further 4,231 cases of suspected malformation are still being investigated.

Research suggests Brazil could expect nearly 180,000 suspected annual cases of microcephaly annually, given the definition currently used.22 While this does not question the dramatic recent rise in children born in Brazil with microcephaly, a reliable estimate of the scale of the problem is aggravated by the factors mentioned above, and looking only at all reported possible cases may show a distorted picture.

What does this mean for life insurers?
The suggestion that Zika infection is linked to microcephaly is of concern in the context of pre-natal cover and family policies that include children automatically. In writing insurance in areas that are affected by the Zika virus and experiencing an abnormal rise in the incidence of microcephaly, it may be prudent to consider excluding benefits for congenital conditions in unborn children.

The increased mortality and morbidity from microcephaly could impact policies that extend coverage to unborn or newborn children without (sufficient) underwriting – even if microcephaly is not explicitly covered. Products that enroll children only after a certain age – when potential congenital defects are already detected – or that use underwriting are likely unaffected.

Certain Critical Illness products include partial or additional payments for Guillain-Barré syndrome. Projections suggest that Zika could lead to a notable increase in total claims for a limited period of time. For example, a 20-fold increase in Guillain-Barré would lead to an incidence of around 30 cases per 100,000. As a comparison, the cancer incidence for Brazil in the age group 40-44 is 150 per 100,000. Levels of Guillain-Barré will not shift permanently higher due to the acquired immunity after infection with Zika virus.

Concern over Zika shows how globalization and expanding population increase the risk that infections are spread more often. It also serves to remind that climate change might lead to new health risks, as mosquitos can populate new areas.

Despite an increase in research activity, a vaccination against Zika is not expected soon, so the virus may continue to pose a threat for several years. While this global alert for Zika will be temporary, together with other outbreaks of infectious diseases such as MERS and Ebola, it looks like the potential impact of infectious diseases is on the rise again – and other outbreaks are to be expected in the future.

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