Actuarial Outpost > Life Valuation Interest Rate for Term Life
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#1
12-12-2017, 06:01 PM
 1695814 Member SOA AAA Join Date: Aug 2002 Studying for nothing. I quit. Favorite beer: Root Posts: 35,206
Valuation Interest Rate for Term Life

Publications such as https://www.willistowerswatson.com/-...portFINAL1.pdf list all sorts of valuation interest rates...whole life, spda, spia...

What about Term life? Is that covered in Appendix 1? "Life Insurance Products - Guarantee duration of n years or less"? ...where n is the term of the life insurance...
#2
12-12-2017, 06:21 PM
 wat? Member SOA AAA Join Date: May 2004 Location: Hi Studying for beer Favorite beer: Fresh Squeezed IPA Posts: 33,170

Quote:
 Originally Posted by 1695814 Publications such as https://www.willistowerswatson.com/-...portFINAL1.pdf list all sorts of valuation interest rates...whole life, spda, spia... What about Term life? Is that covered in Appendix 1? "Life Insurance Products - Guarantee duration of n years or less"? ...where n is the term of the life insurance...
Are you using PBR or not?
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Last edited by wat?; 12-12-2017 at 06:28 PM..
#3
12-12-2017, 06:53 PM
 1695814 Member SOA AAA Join Date: Aug 2002 Studying for nothing. I quit. Favorite beer: Root Posts: 35,206

Quote:
 Originally Posted by wat? Are you using PBR or not?
not yet...but it looks like eventually.
#4
12-12-2017, 07:57 PM
 wat? Member SOA AAA Join Date: May 2004 Location: Hi Studying for beer Favorite beer: Fresh Squeezed IPA Posts: 33,170

Quote:
 Originally Posted by 1695814 not yet...but it looks like eventually.
Then check your state laws, but I imagine it'll be a similar definition to the SVL.

That said, if the product is structured with a x-year level-premium policy, with continuing ART, then I would think it's still considered a whole life product.
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#5
12-12-2017, 10:19 PM
 anon3 Member CAS SOA AAA Join Date: Sep 2001 Posts: 1,306

The correct "n" is the duration of the life insurance (not the level premium period, not the guaranteed premium period). You should assume policyholder can/will continue to renew to expiry. Check out the definition of Guarantee Duration for Life Insurance on the upper left hand corner of page 43 of your linked attachment.
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Last edited by anon3; 12-12-2017 at 10:24 PM..