J
Java Jive
Member
Hi everyone,
I wonder if anyone can guide me through the examiners' report for this question.
When they calculate non-unit fund numbers for the 3rd policy year before the provision is made, they put additional death strain as 0.
But the question clearly states that:
So clearly if policyholder dies during the third policy year, company will have a mortality profit which should be shown in the projected account (as they will pay out death benefit of 100% of the bid value rather than maturity benefit of 115% of the bid value).
Any thoughts?
I wonder if anyone can guide me through the examiners' report for this question.
When they calculate non-unit fund numbers for the 3rd policy year before the provision is made, they put additional death strain as 0.
But the question clearly states that:
On the death of the policyholder during the term of the policy, there is a benefit payable at the end of the year of death of £20,000, or the bid value of the units allocated to the policy, if greater. On maturity, 115% of the full bid value of the units is payable.
So clearly if policyholder dies during the third policy year, company will have a mortality profit which should be shown in the projected account (as they will pay out death benefit of 100% of the bid value rather than maturity benefit of 115% of the bid value).
Any thoughts?