Hi now that the exams are over I wanted to find out how did everyone find the paper.. Mine was a disaster..not sure what was required for the 26 mark last question as well as the sum on solvency ratios..The alteration question for 9 marks was also really weird!! Thats 26+9+6=41 marks Does anyone have any clue what is the pass mark for ST2?
I also struggled with the 26 mark question. I just waffled about the business environment factors. The alterations question was also a bit challenging but I don't think I did well on that one. Overall I'm hopeful for a pass. I just hope the examiners can read my handwriting,lol.
Hey Bidza Glad to know you got along well with the alteration question.Can I ask you how you decided you tackle it.. I said that first you would see if this is allowed by legislation and look at existing competitor practices.After this I said that you could price this as a new contract and build a model to calculate incremental premiums to ensure profit signatures from original contract on original terms is comparable to Altered contract on altered terms and original contract writeen on altered terms. However offering an altertion on this would be unfair to the life company unless a substantial additional premium was taken for the customer for the endowment benefit.
Hi Vicky. I considered the policy values on the term assurance contract and thus treated the new policy as a new contract since the policy value of a TA is likely to be very low.(taking account of the initial expenses which wouldn't be incurred again.) I then went on to discuss the appropriate amount of profit to retain and the basis which would be used.(I remember that under the notes, the section on determining terms to quote discussed the amount of profit to be extracted.) This was my approach. I do not know if it is correct, Guess we have to wait for the examiners report to find out the correct approach. On an aside, I am still having nightmares about that 26 mark question.
Hi, I described the equating policy values for the alteration question, then proceeding to describe the basis etc. For the 26 mark question I went down the route of regulation, deregulation, education, tax relief, government guarantees in case of insurer insolvency, compulsory cover etc describing each one and the extent to which it might succeed. Thought the balance sheet question was tricky for 7 marks. I didn't write much after talking about free assets, with profits investment strategy and how higher expenses might be reason for lower asset share. What did anyone else do?
