In my understanding, (PRO)t should be the profit for t th policy year, starting from time t-1 to t E.g. (PRO)1 is profit for first policy year, starting from time 0 to time 1 However, in ch.18, P.32, it says the PROt is for policy year t+1, the year start at policy time t. Is it the same thing?
Hi, Yes this is the same thing. So the year from 0 to 1 is the 1st year. So the year starts at policy duration t=0 but it's the first year ie t+1. Hope this helps Joe
Yes, the line below the formula on page 32 says "this profit relates to the year starting at policy duration t, that is for policy year t+1".
