By Lawrence White

LONDON (Reuters) – Does a cancelled gym membership spell financial disaster?

That is the type of question British banks are asking as they try to work out whether borrowers owing some 75 billion pounds ($96 billion) in home loans will be good for it when a payment holiday, introduced when the coronavirus crisis first hit, ends.

Lenders are scouring current account transactions, credit card spending and trends in Internet searches for clues about customer finances as part of a wider effort to understand the damage to their portfolios from the pandemic.

The once-in-a-lifetime mix of economic shutdowns, unprecedented government support and an uncertain path to recovery have upended old risk models, based on historical data, necessitating a more dynamic, forward-looking way of analysing lending risk. The searches involve pouring over anonymised data and are a way of surveying overall risk rather than individual customer habits.

The stakes are high: underestimate the risks and bank bosses and shareholders could be in for a nasty jump in losses, overestimate them and banks could rein in lending when it is needed most.

Executives at Britain’s top banks say calculating the hit to loans, from mortgages to corporate debt, is the biggest risk management challenge they have seen since the 2008 crisis.

“This time there is economic volatility beyond what we have ever seen, there is unprecedented government support, and to try and model it all with 100% accuracy is impossible,” said Matt Waymark, director of finance at NatWest Group <NWG.L>.

Some 300 billion pounds in payment breaks were granted on British mortgages, part of a series of measures aimed at propping up households hit by the virus, and around 70-80% of those have resumed payments, bankers and analysts told Reuters.

That leaves nearly $100 billion outstanding at a time when

If you’re like many consumers, you see life insurance as a big mystery. You know you probably need it but aren’t exactly sure how it works—other than that it pays money to your next of kin when you die. In fact, there’s much more to life insurance than a death benefit. And it’s not all that mysterious, provided you know the right people to talk to.

We found one of those people. Andrew Mais, insurance commissioner of the State of Connecticut. Commissioner Mais has plenty of experience demystifying complicated subjects. He’s a graduate of Yale University, previous member of Deloitte’s Center for Financial Services, former director of the New York State Insurance Department (NYSID), research team leader, author of white papers on insurance issues, and provider of expertise to the Government Accountability Office (GAO).

Mais agreed to an extensive discussion about life insurance, how it works, what consumers need to know to protect their families and themselves, and where to go for information and help. Our edited conversation follows.

Insurance Defined

Investopedia: Let’s start by taking a look at the big picture. From your perspective, what is insurance? What does it accomplish for society?

Mais: To me, insurance is a way for society to be able to get things done. And I mean that in the very broadest sense. You go back to the Babylonians and the first record of insurance policies, which were for ships going out to sea. Insurance was a means to facilitate trade so one loss doesn’t wipe everybody out. If you look at it as a way for people to take risks, it’s the engine of capitalism.

Within families, insurance is also a way to preserve wealth. You can go out to work, insure your house, your car, yourself. If something happens, your