What is important in life? Economists, insurance adjusters and old people agree.
What is important in life?
Let’s check with three groups who know about how to value a life:
- Insurance adjusters: Want some harsh truths about human nature? These guys will show you the dark side of evaluating lives when deciding how to pay out in wrongful death cases.
- Economists: Valuing things is their bread and butter. We can get some data-rich answers here.
- Old people: You’re guessing what the rest of your life is worth. They’ve already finished the race.
What’s funny is, though they may disagree on a lot of things, in the end they all recognize one thing that really makes a life valuable: Relationships.
Let’s get started.
How Insurance Adjusters Value A Life
“A wrongful death is worth a base amount,” says George Marr, holding his hand at chest level.
“But if the guy coaches Little League, that’s good,” Ed Quinn adds as George’s hand springs up to chin height.
“He’s got two little girls,” George says.
“And they’re cute.”
“They’re cute,” George repeats. “Boom.” His hand goes above his head.
This is a conversation between two insurance adjusters “doing now what they do all day: computing the value a jury would assign the deceased in a wrongful-death case”, as recounted in Adam Davidson’s fascinating and disturbing 2001 article for the The Atlantic.
Pretty quickly you realize that when evaluating lives, juries (and therefore adjusters) can be frighteningly shallow:
Did I know, they ask me, that a dead man’s worth is partly determined by his wife’s beauty? The prettier she is, Ed explains, “the more jury appeal she has.” But she shouldn’t be gorgeous. “The jury goes, ‘Wait a minute, wait a minute.'” “She’s probably a bitch,” George adds…
A jury of your peers, it turns out, can be a lot like high school:
Here’s the sad truth of what they have come to tell me: In the end, life is exactly what you feared it to be – a popularity contest. As casualty adjusters, Ed and George judge people as if they were casting a Harrison Ford movie or a minivan commercial. The closer the deceased was to an idealized vision of American man or womanhood – a white, straight, successful, outgoing, potent, attractive, middle-aged parent who tenderly cared for spouse, children, and aged parents – the greater his or her worth. Just as in high school, any deviation from the norm is punished. Only with Ed and George, conformity is paid out on a sliding scale. Jocks are worth the most, geeks a lot less, and slutty girls lower everyone’s value.
But just as there was a clear shallow side, a big portion of what increased the value of a life in court cases was connection to others.
Davidson asked a group of adjusters to put a value on his own life.
They ask him a lot of questions and his relationships (or lack thereof) made an enormous difference:
My chest tightens. Frank gently adds that a marriage would add half a million; each kid, another $500,000. (If I were an outdoorsman, he says, my value would double. If I volunteered or went to synagogue, I’d go up 10 to 20 percent. If I called my mom and dad more, I could add $300,000 each.)
Yes, some of their criteria are scary but who else in this world would give you $300,000 for calling mom more often?
How Economists Value A Life
I’ve posted before that economists have done a good job of calculating what parts of your life are worth in dollars.
Seeing friends and family regularly?
To get a happiness boost that big you’d need to make an extra $97,265 every year.
Here’s a breakdown of the biggies:
- Health: +$463,170 a year
- Better social life: +$131,232 a year
- Marriage: +$105,000 a year
- Seeing friends and family regularly: +$97,265 a year
- Divorce: -$34,000 a year
- Unemployment: -$114,248 a year
- Separation: -$255,000 a year
- Death of a spouse: -$308,780 a year
- (Life: $6-9 million)
6 of the 9 are solely about relationships.
(Being dead really hampers your social life, so I could argue for 7.)
Either way, those numbers are BIG.
How much stuff do you worry over that only costs a few hundred dollars when spending more time with people you love can dwarf that in terms of happiness?
And that’s why you want the money, right? To make you more happy?
How Old People Value A Life
The Grant Study followed a group of men from college until the end of life. The results offer deep insight into what makes a good – or bad – life.
They realized there was a single yes/no question that could predict whether someone would be alive and happy at age 80:
“Is there someone in your life whom you would feel comfortable phoning at four in the morning to tell your troubles to?”
The research concluded that “the capacity to love and be loved was the single strength most clearly associated with subjective well-being at age eighty.”
Vaillant’s insight came from his seminal work on the Grant Study, an almost seventy-year (and ongoing) longitudinal investigation of the developmental trajectories of Harvard College graduates. (This study is also referred to as the Harvard Study.) In a study led by Derek Isaacowitz, we found that the capacity to love and be loved was the single strength most clearly associated with subjective well-being at age eighty.
The lead researcher was asked “What have you learned from the Grant Study men?”
And here you are, by yourself, staring at a screen.
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