"Ethics of Actuaries: The AIDS Crisis and Insurance Underwriting"

Ethics has been central in business-history research on the U.S. life and health insurance industry, reflecting limited accessibility and societal criticism (Chapin, 2015; Murphy, 2010; Zelizer, 1979). “Actuarial fairness” has been presented as the moral basis for discrimination, such as excluding or charging higher premiums to high-risk individuals (Landes, 2015).
This research examines actuaries’ ethics when the HIV/AIDS epidemic hit the insurance industry during the 1980s and 1990s. It addresses the question: How did actuaries, and with which professional ethics, confront the uncertainties of the epidemic and the risks of HIV-positive applicants? As professionals working for insurance companies who calculated health and mortality risks and set underwriting standards, actuaries were central actors in the industry’s practices of denying underwriting or restricting coverage, which activists criticized.
The analysis focuses on actuaries’ rationalism as part of their professional identity, a concept developed in sociology, and considers how employment conditions shaped their ethics (Collins et al., 2009; Porter, 2009). Drawing on publications of the Society of Actuaries, the study analyzes debates on underwriting and professionalism, situating employment relations as factors influencing underwriting policies. Thus, this study shows how underwriting policies were “co-created” across three layers: the professional circle, employment relations, and societal criticism.
The study finds that actuaries consistently opposed underwriting HIV-positive individuals, justifying this stance as essential to long-term financial stability. While corporate managers pursued short-term profit and market share, actuaries framed conservative underwriting and mandatory HIV testing as a professional ethic grounded in risk management. This position was reinforced by anxieties over organizational restructuring, technological change, and job insecurity, making the AIDS crisis a key occasion to reassert their occupational value. These findings suggest that “actuarial fairness” functioned less as a genuine ethical principle than as a rhetorical defense of conservative underwriting.