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Long-Term Actuarial Math Old Exam MLC Forum

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  #1  
Old 04-30-2006, 08:47 PM
Peter Lemonjello's Avatar
Peter Lemonjello Peter Lemonjello is offline
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Default Reserve Recursion Problem

I'm stuck on this problem:

For a fully discrete whole life insurance with non-level benefits on (70):
(i) The level benefit premium for this insurance is equal to P_50.
(ii) q_70+k = q_50 _ 0.01, k = 0, 1, ...19
(iii) q_60 = 0.01368
(iv) k_V = k_V_50, k = 0, 1, .. 19
(v) 11_V_50 = 0.16637

Calculate b11, the death benefit in year 11. (Answer is 0.648)

Ok, the solution sets up two recursion equations:

10_V + P = v q_80 b_11 + v p_80 11_V
10_V_50 + P = v q_60(1) + v p_60 11_V_50

My question is this: What tells us that the benefit for (50) in year 10 is 1?
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  #2  
Old 04-30-2006, 08:58 PM
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Peter Lemonjello Peter Lemonjello is offline
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Default

If I would just read all the solution, I would have realized that k_V_50 is the reserve for a standard insurance with unit benefit.

You may resume your regulary schedule programming. Sorry for the interruption ....
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  #3  
Old 09-16-2017, 11:18 AM
Kely Kely is offline
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College: University of Iowa Second Year Graduate
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Default

Good job man, I also met the problem like yours and I solved it due to your second reply. Thanks.
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