Calculate reserves for long-term life and health insurance and annuity contracts using profit testing.
Free SOA Exam ALTAM (Advanced Long-Term Actuarial Mathematics) lesson in Profit Analysis. 13 min read, ~1,940 words.
Profit vector is profit per policy in force at start of year; profit signature is profit per policy issued, where carries both mortality and lapse. Zeroization picks the smallest non-negative reserves making each for, funding future losses from earlier surplus. Recursion per policy in force:. Solve backwards from (or the...
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What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Check Your Understanding
- Exam Shortcuts
Learning objectives
- 4e
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