A Unified Actuarial Framework for Integrated Health, Mortality, and Disability Risk Modelling in Sub-Saharan Africa

This study develops a unified actuarial framework for the simultaneous modelling of health, mortality, and disability risks in the Sub-Saharan African context, with empirical validation using Nigerian longitudinal health data. Existing actuarial multi-state models for health and disability have been developed primarily from European and North American experience and rely on assumptions about healthcare system quality, cause-of-death structures, and disability classification that may not be transferable to Nigeria or comparable Sub-Saharan African environments. This study proposes an extended multi-state model that integrates morbidity, disability, and mortality transitions within a single continuous-time Markov framework, with state space and transition structure adapted to reflect Nigerian healthcare and demographic realities. The model is estimated using data from the Nigerian Longitudinal Aging Study and three waves of the National Demographic and Health Survey, with maximum likelihood and Bayesian inference methods applied to estimate transition intensities by age, sex, and geopolitical zone. Goodness-of-fit testing against out-of-sample mortality and disability outcomes validates the model. Findings establish that the unified framework significantly outperforms separate competing risk models in predicting joint health-disability-mortality outcomes, particularly in the 60 and over age group where the three risks are most correlated. The study contributes an original Sub-Saharan African multi-state risk model, calibration methodology, and software implementation as a public-good research contribution, and recommends its adoption as the reference model for social insurance and life insurance actuarial work across the region.

Keywords: multi-state model, mortality, disability, morbidity, Sub-Saharan Africa.