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Edu 2017 Fall Exam MLC Syllabus

The document outlines the important information and learning objectives for the Models for Life Contingencies Exam Fall 2017, including topics such as survival models, present value random variables, premium calculation, reserves, and pension plans. Each topic includes specific learning outcomes that candidates are expected to achieve, along with resources for study. Candidates are advised to register online, check for updates, and refer to past exams for preparation.

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13 views5 pages

Edu 2017 Fall Exam MLC Syllabus

The document outlines the important information and learning objectives for the Models for Life Contingencies Exam Fall 2017, including topics such as survival models, present value random variables, premium calculation, reserves, and pension plans. Each topic includes specific learning outcomes that candidates are expected to achieve, along with resources for study. Candidates are advised to register online, check for updates, and refer to past exams for preparation.

Uploaded by

addi boi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Models for Life Contingencies Exam

Fall 2017

Important Exam Information:

Exam Registration Candidates may register online or with an application.

Introductory Study Note The Introductory Study Note has a complete listing of all study
notes as well as errata and other important information.

Past Exams Past Exams from 2000 - present are available on the SOA website.

Updates Candidates should be sure to check the Updates page on the exam
home page periodically for additional corrections or notices.
Models for Life Contingencies
FALL 2017

1. Topic: Models for single and multiple lives (10-20%)

Learning Objectives

The Candidate will understand key concepts concerning tabular or parametric survival models and single or
multiple-life states.

Learning Outcomes

The Candidate will be able to:


a) Explain and interpret the effects of transitioning between states, the survival models and their
interactions. Calculate and interpret standard probability functions including survival and mortality
probabilities, force of mortality, and complete and curtate expectation of life.
b) For models dealing with multiple lives and/or multiple states, explain the random variables associated
with the model; calculate and interpret marginal and conditional probabilities, and moments.
c) Using the factors mentioned in Learning Outcomes 1a and 1b, construct and interpret survival models
for cohorts consisting of non-homogeneous populations, for example, smokers and non-smokers or
ultimate-and-select groups.
d) Describe the behavior of continuous-time and discrete-time Markov chain models, identify possible
transitions between states, and calculate and interpret the probability of being in a particular state and
transitioning between states.
e) Apply to calculations involving these models appropriate approximation methods such as uniform
distribution of deaths, constant force, Woolhouse, and Euler.

2. Topic: Present Value Random Variables (10-20%)

Learning Objectives

The Candidate will be able to perform calculations on the present value random variables associated with
benefits and expenses for any of the models mentioned in the Learning Outcomes of Learning Objective 1.

Learning Outcomes

The Candidate will be able to:


a) Calculate and interpret probabilities, means, percentiles and higher moments.
b) Calculate and interpret the effect of changes in underlying assumptions such as mortality and interest.
c) Apply to calculations involving these random variables appropriate approximation methods such as
uniform distribution of deaths, constant force, Woolhouse, and Euler.

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Models for Life Contingencies
FALL 2017

3. Topic: Premium Calculation (20-35%)

Learning Objectives

The Candidate will be able to both calculate with and explain premium-calculation methodologies such as the
equivalence principle, the portfolio-premium principle, and premiums determined by specified profit objectives.

Learning Outcomes

The Candidate will be able to:


a) Calculate and interpret probabilities, means, percentiles and higher moments of random variables
associated with these premiums, including loss-at-issue random variables.
b) Using any of the models mentioned in the Learning Outcomes of Learning Objective 1, calculate and
interpret the effect of changes in policy design and underlying assumptions such as changes in
mortality, benefits, expenses, interest and dividends.
c) Perform the calculations mentioned in Learning Outcomes 3a and 3b for contracts associated with
specified contingent cash flows including
o Non-interest-sensitive insurances;
o Annuities;
o Universal life insurances; and
o Participating insurances.
d) Apply to calculations involving these premiums appropriate approximation methods such as uniform
distribution of deaths, constant force, Woolhouse, and Euler

4. Topic: Reserves (20-35%)

Learning Objectives

The Candidate will understand reserves for insurances and annuities for models mentioned in the Learning
Outcomes of Learning Objectives 1 and 3.

Learning Outcomes

The Candidate will be able to:


a) Calculate and interpret any of (i) several reserve types including benefits reserves, gross premium
reserves, expense reserves or any of (ii) several reserve methods such as Full Preliminary Term (FPT) or
modified reserves.
b) Calculate and interpret probabilities, means, percentiles and higher moments of random variables
associated with these reserves, including future-loss random variables.
c) Calculate and interpret asset shares, expected profit, actual profit, gain, gain by source and period,
internal rate of return and other common profit measures.

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Models for Life Contingencies
FALL 2017

d) Calculate and interpret the effect of policy modifications.


e) Calculate and interpret contract account values, contract surrender values and profit measures on
universal life insurance contracts.
f) Compare and contrast non-interest-sensitive and participating insurances with universal life
insurances.
g) Calculate and interpret the effect of changes in policy design and underlying assumptions such as
changes in mortality, benefits, expenses, interest and dividends.
h) Apply to calculations involving these reserves appropriate approximation methods such as uniform
distribution of deaths, constant force, Woolhouse, and Euler.

5. Topic: Pension Plans and Retirement Benefits (10-20%)

Learning Objectives

The Candidate will understand how the models from previous Learning Objectives apply to pension plans and
retirement benefits.

Learning Outcomes

The Candidate will be able to:


a) Describe and compare defined contribution and defined benefit pension plans including final salary and
career average earning plans.
b) Identify and interpret the common states and decrements for pension plans, and the parametric and
tabular models, including Markov chain models, associated with these decrements.
c) Given particular participant data, plan provisions, and valuation assumptions, apply the models
mentioned in learning outcome 5b to defined benefit pension plans and calculate and interpret
replacement ratios, accrued benefits, and their expected values with adjustments such as the early
retirement reduction factor.
d) Given particular participant data, plan provisions, and valuation assumptions, calculate and interpret
the actuarial accrued liability and the normal cost for a defined benefit plan under the projected unit
credit (PUC) cost method and the traditional unit credit (TUC) cost method.
e) Calculate and interpret the effect of changes in underlying valuation assumptions such as mortality,
salary increase changes, other decrements and interest on the quantities mentioned in learning
outcomes 5c and 5d.
f) Apply to calculations involving these defined benefit pension plans appropriate approximation
methods such as uniform distribution of deaths, constant force, Woolhouse, and Euler.

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Models for Life Contingencies
FALL 2017

Resources

• Actuarial Mathematics for Life Contingent Risks, 2nd Edition, 2013, Dickson, D., Hardy, M., Waters, H.,
Cambridge University Press, ISBN: 978-1-110704-407-4. Exercises are considered part of the required
readings.
o Chapters 1-13 (Except Section 11.5)
• Notation and Terminology Note
• Exam MLC Tables
Note, the text and the Notation and Terminology Note will not be available with the examination booklet. A copy of the
Tables will be available.

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