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Sept 24 Q2 iv)

A

Actuary@22

Ton up Member
Hi

In Q2 iv) Why does the examiner report not mention the actual experience being better than what was assumed to calculate BEL? Eg actual expenses being lower than expected,persistency experience changes etc
 
Hi

The question is about possible reasons for a fall in the BEL. This is different from possible reasons for a change in surplus (which may be defined as 'assets - BEL').

Actual expenses being lower than expected would affect the assets, but not the BEL. Persistency experience variances would affect the BEL via the different number of policies in force at the end of the year - and in fact the examiners' report does include this.

Either expense or persistency variations may lead to a change in assumptions, and these would affect the BEL. Again, the examiners' report does mention both of these.
 
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