SOA Exams & Modules
Module Overview Domestic/Foreign/Alien Insurance Companies U.S. insurance departments classify insurance companies as “domestic,” “foreign” and “alien.” Insurance companies formed outside the United States may be authorized to do business in the United States. These non-U.S. companies are called “alien”. The McCarran-Ferguson Act Regulation of life insurance in the United States has always been primarily a responsibility of the various states, …
[mathjax] Linear Models Classification of Variables Intention (by their role in the study) target/response/dependent/output variable risk factors/drivers Characteristics (by their nature) numeric/quantitative variables categorical/qualitative/factor variables The Model Building Process Stage 1: Define the Business Problem Objectives prediction-focused (accurate prediction) vs. interpretation-focused (relationship) Descriptive Analytics: Focuses on insights from the past and answers the question, “What happened?” Predictive Analytics: Focuses …
Developing an ERM Framework ERM Framework Criteria (Effective ) Scope is enterprise-wide All risk categories included Focused on key risks Enhances decision making ability Integration across risk type Aggregated metrics Balanced risk & return management Appropriate disclosures Measures value impacts Primary stakeholder focus Challenges to ERM Analysis The implementation of a strong ERM framework must address three primary hurdles. Quantification …
[mathjax] Introduction The Introduction to ILA module will give an overview of the role of an actuary in a Life and Annuity context. The module will give a strong foundation of understanding of life insurance and annuity product features, markets and distribution. Candidates will also learn the fundamentals of product development, pricing, reinsurance, valuation, financial reporting and administration. This module …
[mathjax] Basic Probability Functions and Moments Probability Density Function \(f(x)=\dfrac{d}{dx}F(x)\) or \(f(x)=-\dfrac{d}{dx}S(x)\) Hazard Rate Function \(\mu (x)=h(x)=\dfrac{f(x)}{S(x)}=-\dfrac{d\ln S(x)}{dx}\) Cumulative Hazard Rate Function \(H(x)=\int_{-\infty }^{x}{h(t)dt}=-\ln S(x)\) \(S(x)=e^{-H(x)}=e^{-\int_{-\infty }^{x}{h(t)dt}}\) Moment of X nth Raw Moment of X: \(\mu’_{n}=E[x^n]\) nth Central Moment of X: \(\mu_n=E[{(x-\mu )}^n]\) Covariance: \(Cov(X,Y)=E[(X-\mu_X)(Y-\mu_Y)]=E[XY]-E[X]E[Y]\) Correlation Coefficient: \(\rho_{XY}=Cov(X,Y)/({\sigma_X}{\sigma_Y})\) Coefficient of Variance: \(\sigma /\mu \) Skewness: \(\gamma_1=\mu_3/\sigma^3\) Kurtosis: \(\gamma_2=\mu_4/\sigma^4\) Moment Generating …
Basic Calculus Integrations \(\dfrac{d}{dx}a^x=a^x\ln(a)\) \(\int{{{}\over{}}a^xdx}=\dfrac{a^x}{\ln(a)}\text{ for }a>0\) Logarithmic Differentiation \(\dfrac{df(x)}{dx}=f(x)(\dfrac{d\ln f(x)}{dx})\), since \(\dfrac{d\ln f(x)}{dx}=\dfrac{df(x)/dx}{f(x)}\) Partial Fraction Decomposition \(\int{{{x}\over{1+x}}dx}=\int{(1-{{1}\over{1+x}})dx}\) Integration by Parts \(\int{udv}=uv-\int{vdu}\) Special Cases: \(\int_{0}^{\infty }{xe^{-ax}dx}=\dfrac{1}{a^2}\), for \(a>0\) \(\int_{0}^{\infty }{x^2e^{-ax}dx}=\dfrac{2}{a^3}\), for \(a>0\) Sets Set Properties Associative Property \((A\cup B)\cup C=A\cup (B\cup C)\) and \((A\cap B)\cap C=A\cap (B\cap C)\) Distributive Property \(A\cup (B\cap C)=(A\cup B)\cap (A\cup C))\) …
Accounting Principles
Product Classification Why need product classification? Not all products manufactured by insurance companies are insurance contracts Insurance contracts are those that contain significant insurance risk How products are classified? For valuation purposes, insurance contracts can be further classified into: Ordinary Life – Participating Ordinary Life – Non-Participating Personal Accident Unit-linked (Contracts with an explicit account balance) Universal life (Contracts with …
Introduction IFRS 17 Insurance Contracts establishes principles for the recognition, measurement, presentation and disclosure of insurance contracts issued. It also requires similar principles to be applied to reinsurance contracts held and investment contracts with discretionary participation features issued. The objective is to ensure that entities provide relevant information in a way that faithfully represents those contracts. This information gives a …
Coding & Programming
File Management CopyFolder Function: CopyFolder (Source As String, Target As String) As Integer Copies contents of a source folder including subdirectories to the target folder. If target folder exists then it will be deleted before copy operation is performed. Returns True(-1) if successful or False(0) if failed. Example: DeleteFolder Function: DeleteFolder (FolderName As String) As Integer Deletes a directory with …
Types of Tables Tables are used at many levels in AXIS for many different: uses, structures, and shapes Table Hierarchy Characteristics Cell Tables Used only by cells, or by sub-objects linked to cells Support policy level calculations at the cell level Projection Tables Used by higher level objects, such as sub-funds, funds and offices Column-specific shape Rows are financial years …
Background There are times you are interested in summing up the results across various dimensions with specified conditions or indicators to exclude some results from the ARRAY_SUM function. There is an incident that I need to separate medical health UCOI cash flows from total medical UCOI cash flows, because there are different loss ratios for these two types of UCOI …
What is calculation looping? Calculation looping is a process whereby parts of the calculation are repeated several times. In many ways it is similar to the rebasing facility. However, calculation looping differs from rebasing in the following ways: With calculation looping the parts that are repeated are repeated for the whole of the period of calculation. With rebasing only the …
Fundamental Concepts Notes Goal-seeking cannot be used in conjunction with looped modules. If you wish to goal seek at a product or fund level, you should use the REPEAT_LEVEL function. Variables used in goal-seeking Variable Description SEED_VAL Seed value for first iteration. PREV_VAL Value for current iteration. NEXT_VAL Value for next iteration. IF_CONVERGED If iteration has converged. How …
Dates CODE_SEGMENT Dates ; Valuation Date IF LEN(STRVAL(MONTH(EXTRACT_DATE))) = 1 THEN VAL_DATE = STRVAL(YEAR(EXTRACT_DATE)) + “0” + STRVAL(MONTH(EXTRACT_DATE)) ELSE VAL_DATE = STRVAL(YEAR(EXTRACT_DATE)) + STRVAL(MONTH(EXTRACT_DATE)) ENDIF ; Last-Year End LYE_DATE = STRVAL(YEAR(EXTRACT_DATE) – 1) + “12” ; Beginning of Current Year BOY_DATE = STRVAL(YEAR(EXTRACT_DATE)) + “01” ; Last-Month LM_M = STRVAL(NUMVAL(SUBSTR(VAL_DATE, 5, 2)) – 1) IF LEN(LM_M) = 1 THEN LM_M …