Apr 2022 Q4 v)

Discussion in 'SP2' started by Actuary@22, Apr 11, 2023.

  1. Actuary@22

    Actuary@22 Very Active Member

    Hi

    Please explain how the insurer makes the full expected profit from this contract as per the examiner report"

    "As the surrender value is calculated prospectively using best estimate assumptions then
    the insurer makes the full expected profit from the contract [½]
    this might be considered unfair for the policyholders as the insurer hasn’t been exposed
    to the risk for the full term"
     
  2. Darrell Chainey

    Darrell Chainey ActEd Tutor Staff Member

    This is explained in Section 4 of Chapter 22 of the course notes.
     

Share This Page