Free SOA Exam FAM Premium and Policy Value Calculation for Long-Term Insurance Coverages Practice Questions (2026)

Sample Questions

Question 1 Easy

Which expression equals

P (A_{x})

Solution

E is correct.

P = (1 - d a ¨_{x}) / a ¨_{x} = 1/ a ¨_{x} - d

Question 2 Medium

For a fully discrete whole life insurance of 1 with

_{10} V = 0.18

P = 0.02

q_{x + 10} = 0.015

i = 0.06

, calculate

_{11} V

Solution

C is correct.

(0.18 + 0.02) (1.06) = 0.015 + 0.985 \cdot_{11} V

0.212 = 0.015 + 0.985 \cdot_{11} V

_{11} V = 0.197/0.985 = 0.200

Question 3 Hard

For a fully discrete whole life insurance of 1 on (x), you are given:

-

A_{x} = 0.25

i = 0.06

If mortality increases so that A'_x = 0.35, calculate the change in the net premium

P_{x}

Solution

E is correct.

d = 0.06/1.06 = 3/53

.

Original:

a ¨_{x} = \frac{0.75}{3/53} = \frac{0.75 \times 53}{3} = \frac{39.75}{3} = 13.25

P_{x} = \frac{0.25}{13.25} = 0.01887

New:

a ¨_{x}^{'} = \frac{0.65}{3/53} = \frac{0.65 \times 53}{3} = \frac{34.45}{3} = 11.483

P_{x}^{'} = \frac{0.35}{11.483} = 0.03048

Change

= 0.03048 - 0.01887 = 0.01161

0.01161

, closest to

0.01000

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Free SOA Exam FAM (Fundamentals of Actuarial Mathematics) Premium and Policy Value Calculation for Long-Term Insurance Coverages Practice Questions

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