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The cost of uncertainty
In an earlier blog I wrote about how stochastic volatility in run-off increases with age. This applies when you exactly know (or think you know) the current and future mortality rates.
Getting used to Solvency II
Insurers and reinsurers throughout the EU are facing up to the implementation of Solvency II, a radical overhaul of regulatory standards for insurance business. Recently we explored how much Solvency II demands stochastic models.
Upwardly mobile
We recently discussed the ways server-based modelling software facilitates collaboration across boundaries. Another important boundary is the office wall, although what was once considered an impermeable divide between work and the rest of our lives, is nowadays all-too porous.
Salt of the Earth
Most of our readers will normally associate the acronym FSA with the Financial Services Authority, the body supervising financial-services providers in the United Kingdom. Confusingly, another UK regulator has the same acronym: the Food Standards Agency, which has nothing to do with financial services.
A problem shared
Creating a good model from your experience data is not always straightforward.
Does Solvency II demand stochastic models?
Solvency II is a major overhaul of the reserving rules for insurers throughout the European Union. An important consideration for annuity writers is how it will relate to longevity trend risk.
Health of the nation
Geodemographic profiles use addresses or postcodes to classify people into groups which are homogeneous with respect to variables like income, housing tenure and life stage. The original purpose of geodemographic profiles was to improve targeting for marketing purposes.
Over-dispersion (reprise for actuaries)
In my previous post I illustrated the effects of over-dispersion in population data. Of course, an actuary could quite properly ask: why use ONS data?
Lost in translation
Actuaries have a long-standing habit of using different terminology to statisticians. This page lists some common terms used by actuaries in mortality work and their "translation" for a non-actuarial audience. The terms and notation are those used by actuaries in the UK, but in every country I have visited the local actuaries have used similar notation.
Table 1. Common actuarial terms and their definition for statisticians.