I have been going through the definitions in Chapter 39 and would would be grateful if someone here could clarify a couple of points: For the purposes of CP1, is there a distinction between a deferred member and an early leaver ? Outside of the context of CP1 and the various IFoA syllabuses is there normally a distinction between the meanings of these two terms ? (I am of course keeping in mind here that "An important part of any actuarial investigation is to verify the exact meaning of any important terms used.")
Hi: an 'early leaver' is anyone who ceases to be an active member of a benefit scheme, other than through death or retirement. In other words, they are no longer actively accruing benefits - most likely because they are no longer employed by that company. At that point, they may become a deferred member of the scheme - whereby they remain in the scheme and, once they reach retirement age, receive the benefits accrued up to the point of discontinuing. However, that's not the only possible outcome. The early leaver might instead transfer the value of their accrued benefits to another pension arrangement. In some jurisdictions, they might even be able to take a cash sum on discontinuance. So a deferred member is an example of an early leaver, but an early leaver doesn't have to become a deferred member. Hope that helps clear up this distinction.
