Search Results

1. Post

Difference between freehold and leasehold

The total return on an investment = income yield plus capital growth. It’s the total return that ultimately matters.
Post by: mugono, Dec 13, 2021 in forum: CP1
2. Post

Is TVOG equal to the cost of guarantees mathematically?

The TVOG can be valued using option pricing techniques. CM2 may set out what you’re looking for.
Post by: mugono, Jul 4, 2021 in forum: SP2
3. Post

Is TVOG equal to the cost of guarantees mathematically?

Example: a with profit contract may have a guarantee that exceeds the asset share. The difference between the guarantee and asset share is the ‘in...
Post by: mugono, Jul 3, 2021 in forum: SP2
4. Post

Is TVOG equal to the cost of guarantees mathematically?

The value of an option is equal to the intrinsic value + time value. The cost of guarantees is equal to TVOG if the contract is ‘out of the...
Post by: mugono, Jul 3, 2021 in forum: SP2
5. Post

counterparty default risk in Solvency 2

Hi, Cash at bank is a type 1 exposure for standard formula purposes.
Post by: mugono, Dec 9, 2020 in forum: Off-topic
6. Post

Chapter 11: Expectations theory

Is the discount rate used a 6 month rate...
Post by: mugono, Dec 5, 2020 in forum: CP1
7. Post

Difference Statistical Distribution vs Stochastic Model

There may be a number of actuaries on this forum who are closer to the underlying workings of stochastic models or modelling than me. Nevertheless...
Post by: mugono, Sep 1, 2020 in forum: CP2
8. Post

Difference Statistical Distribution vs Stochastic Model

No. For example, the normal distribution has a 'certain' bell shaped curve. The probability under the curve (P<0) of a standard normal random...
Post by: mugono, Sep 1, 2020 in forum: CP2
9. Post

How does traditional reinsurance reduce required capital?

Recoveries would not increase BEL. It would reduce BEL (net of reinsurance). I don't in-principle see why you would lose marks unless...
Post by: mugono, Aug 22, 2020 in forum: SA2
10. Post

Can a lapse assumption that lowers reserves be used under Solvency II?

1, No - Solvency II only came into effect on 1.1.16. The statutory reserves would have included prudence within the reserves (i.e. best estimate +...
Post by: mugono, Jul 22, 2020 in forum: SA2
11. Post

How does traditional reinsurance reduce required capital?

The insurer purchases reinsurance. The addition of a reinsurance recoverable (an asset) is broadly offset by a reduction in the insurer's cash...
Post by: mugono, Jul 11, 2020 in forum: SA2
12. Post

Why is subordinated loan stock considered a liability for shareholders?

Equity holders are paid only after / if all other obligations have first been settled.
Post by: mugono, Jul 11, 2020 in forum: SA2
13. Post

Why does the risk margin increase with increased reinsurer default risk?

yes
Post by: mugono, May 28, 2020 in forum: SA2
14. Post

Definition of SCR and SF Model

CEIOPS-SEC-40-10. The paper is titled: Solvency 2 calibration paper and was published on 15 April 2010
Post by: mugono, May 23, 2020 in forum: SA3
15. Post

WBS requirements and time to receive the degree

These look like questions for the Institute.
Post by: mugono, May 21, 2020 in forum: General study / exams
16. Post

How do collateral payments work under a longevity swap?

Collateral definition Not quite. The reinsurer is exposed to the counterparty risk when PV fixed > PV floating. The effect of the collateral...
Post by: mugono, May 7, 2020 in forum: SA2
17. Post

How do collateral payments work under a longevity swap?

Hi curiousactuary, Some comments from me: hope it helps. 1. Whether the insurer or reinsurer posts collateral will depend on the difference...
Post by: mugono, May 6, 2020 in forum: SA2
18. Post

Studier has provided a good answer within the UK context. Solvency 2 leaves it up to individual member states to decide whether firms in their...
Post by: mugono, Apr 25, 2020 in forum: SA2
19. Post

Sensitivity of reserve

How far are you in your ‘actuarial journey’?
Post by: mugono, Apr 4, 2020 in forum: SA2
20. Post

There is a maximum of 100% of each premium in the case of a contract that lasts more than 20 years

I've not read the relevant Core Reading notes. Nevertheless: The tax authorities will allow the policyholder to reduce their taxable benefit by...
Post by: mugono, Mar 19, 2020 in forum: SA2
21. Post

September 2019 exam discussion

I’m surprised that emailing your script to the examination team didn’t occur to you.
Post by: mugono, Oct 9, 2019 in forum: CS2
22. Post

State price deflator

All text in bold text (core reading) is examinable. Otherwise it is not.
Post by: mugono, Aug 7, 2019 in forum: CM2