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All you need to know for non-BLAGAB losses is what is in the Core Reading: Accounting losses can be used to offset profits in other tax years or...
It is likely that the duration of the annuity liabilities is longer than that of available assets and so an interest rate fall will increase...
Do you mean if interest rates go up, does the value of the bond fall? If so, yes. But it is not a risk for the company as there is no guaranteed...
Under EV Solvency II, the idea is that due to assumptions being best estimate there are no release of prudential margins within the BEL. So yes,...
A company will base these calculations on a fund basis, not an individual basis.
If a company is in an XSE position then they will have losses to carry forward on their BLAGAB business, which they can use to offset their I in...
Yes that's a fair observation, but this is likely to be relatively second order.
Yes as it is actual inflation being applied but if the inflation rate used in the future were to change then this would be an assumption change.
If expense inflation has been higher (or lower) than expected over the period, the end-of-period BEL will be higher (or lower) than expected as...
Risk margin is specifically referring to Solvency II. The justification for including its release as PVIF is because it will no longer be needed...
There is no reinvestment risk as the bonds do not have to be repurchased once there is a surrender. The policyholder will just receive the value...
The projection basis are the future experience assumptions used to calculate the future cashflows within the embedded value model, whereas the...
Hi Niamh The solution takes out R as the factor and then multiplies it by the sum of all the factors applied to R in the previous line: ie,...
Hi Tina Let me try and explain: To calculate such a plan, we can either sum: an endowment of 10,000 and a pure endowment of 10,000. So 10,000...
Hi Tina Can you tell me which particular bit you are not sure about? Thanks Em