Calculate and interpret expected profit and actual profit.

Free SOA Exam ALTAM (Advanced Long-Term Actuarial Mathematics) lesson in Profit Analysis. 38 min read, ~5,751 words.

Profit vector: the per-policy year-end cash flow, conditional on being in force at the start of year. Profit signature weights by the probability of being in force at the start of year, measured from issue. Expected profit at issue is the NPV of at the hurdle rate (not the earned...