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Old 03-01-2018, 09:41 AM
Josh Peck Josh Peck is offline
Join Date: Dec 2016
College: Towson University
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Thumbs up Official name of "traditional" models

I keep seeing these models at work and I was wondering what the official name of this type of model is.

For example, you could have

LapseRate = Base * ITM(X) * SCPenalty(X)

I understand that this is a product of factors, and that the factors are calculated using MLE.
However, everyone just calls these "traditional" models.
I did not learn about these models in school and would like to know more about them.
Does anyone know the official name for this type of model?

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Old 03-01-2018, 10:21 AM
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JMO JMO is offline
Carol Marler
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Old 03-01-2018, 10:41 AM
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Stedit Stedit is offline
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Not sure if there's a standard name in the industry for this, but we would call this a "dynamic" model at my company, as the lapse rate varies based on the model's view of the policy option (i.e. in or out of the money) at each point in time.
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Old 03-01-2018, 11:15 AM
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