Description: The interaction of section 7702 cash value accumulation test [CVAT] and state nonforfeiture laws [SNFL] create a dual limitation on traditional life insurance contratcs. CVAT limiting the maximum permissible cash value and SNFL requiring a minimum cash surrender value. This article examines these dual limitations.

Description: For actuarial projections to serve as the management tools that they are intended to be, the persons charged with making those projections need to consider whether the projection is sufficiently sophisticated so that it does not miss major items.It is important to consider the tax effect. This article covers several of the major tax issues that should be considered in any actuarial projection.

Description: The authors suggest that mastering 'star performer' skills and work strategies is simply a matter of learning and practicing the outlined techniques. From The Stepping Stone, February 2012, Issue No. 45.

Description: This research report on the effect of deflation or high inflation has six sections: 1. The first section provides background on inflation, describes some problems in measuring inflation, and explains some of its effects on an economy. 2. The second section reviews historical inflation rates. 3. The third section examines the effect of inflation or deflation on the property-liability and life insurance industries. 4. The fourth section proposes risk mitigation strategies for insurers to cope with either deflation or high inflation rates. 5. The fifth section describes a publicly available model that can be used to develop inflation/deflation projections under a regime switching format that can readily be adjusted to reflect current financial uncertainty. 6. The sixth section provides conclusions.

Description: This article reviews some of the highlights of th 2010 SOA Annual meeting including the impact on pricing resulting from Solvency II, Market Consistent Valuation of New Business - MCVNB, the latest on mortality, Standards of Practice in product development, managing risk in product design and a regulation update.

Description: This overview study note for the Society of Actuaries Spring 2012 Financial Economic Theory and Engineering [FETE] exam is intended to provide candidates with an approach for organizing the course of reading for studying the various sections of the course.

Description: This article predicts the gap between the full U.K. Basic State Pension [BSP] and household expenditure in 2056 for a range of different dynamic inflation [Consumer Price Index, or CPI] predictions. The best and worst case scenario and the average surplus and deficit are detailed and analyzed in order to determine whether the BSP is sufficient to cover the expenditures for a state pension dependent single person and married couple.

Description: Book review of 'You Don’t Need a Title to Be a Leader.'

Description: This article discusses the Own Risk and Solvency Assessment ORSA Guideline that is being developed by the NAIC Group Solvency Issues working group as part of the Solvency Modernization Initatitve SMI. It looks at the purpose of the ORSA, the three sections of the NAIC ORSA and issues with current U.S. ORSA draft.

Description: This is the December 2011 cover of The Actuarial magazine displaying the featured articles inside: How to Handle ORSA, The Actuarial Profession in India, and The SOA's Competency Framework

Description: The recent financial crisis created incentives to review investment practices and see what was done well and what could be improved for the future. Looking inward at insurer investment practices, background trend information was generated and a survey developed for insurers to share their thoughts. The research continued with conversations in private and public forums, where initial conclusions were expanded.

Description: This article argues that wealth managers should advocate dynamic spending in proportion to survival probabilities, adjusted up for exogenous pension income and down for longevity risk aversion. The authors criticize the rule of thumb of spending a fixed 'x' percent of assets for retirement planning purposes.

Description: This article recommends actions to key stakeholders to address the systemic risk in the retirement systems as employer and government based pensions reduce, and more emphasis is placed on personal savings.

Description: The actuarial profession in India has witnessed a sea change in the decade after insurance liberalization. It has gone from being described as a 'moribund profession' to being a dynamic and lucrative one. This article covers the actuarial professions growth in India along with the Life Insurance market, products and regulatory environment.

Description: Kevin Binder, chair of the Pension Section Research Team, shares a summary of two recently completed projects that are now posted on the SOA website.The first topic is on the drawing down of retirement savings and the second is on the valuation of pension plan embedded options. From Pension Section News, October 2011, Issue No. 75.

Description: This article reviews the proposed new accounting standards for pensions for governmental plans. From the Pension Section News, October 2011, Issue No. 75.

Description: This document summarizes the many potential hazards individuals may face during retirement. It is designed to serve as a complement to other retirement planning resources.

Description: Replacement rates have historically been a tool to determine the adequacy of retirement income to maintain an individual’s standard of living. Numerous conceptual and methodological issues lie, however, beneath its simple exterior. The purpose of this paper is to examine these underlying issues for the benefit of retirement security stakeholders, pension plan sponsors, advisors, financial product providers, and individuals planning for retirement.

Description: The Pension Section is pleased to make available Part I of a two-part research paper exploring embedded options in pension plans. Part I includes a catalogue of embedded options in pension plans and the results of a related survey of pension practitioners. The paper was written by PricewaterhouseCoopers LLC.

Description: Listing and description of key articles in August 2011 issue of Risk Management. Topics include Predictive Modeling, Risk management and Solvency II.

Description: The author discusses the various components that may have an effect on the future of mortality such as the extinction of numerous species of flora and fauna the growth of agribusiness genetically modified foods, better public health institutions and programs, etc.

Description: Feature article discussing the major issues multinational reinsurers face in Brazil.

Description: This paper examines the following three questions by reviewing literature that identifies and evaluates the tradeoffs among annuitization and self-managed drawdown strategies: 1. How DO Retirees Draw Down their Financial Savings? 2. How COULD Retirees Draw Down their Financial Savings? 3. How SHOULD Retirees Draw Down their Financial Savings?

Description: This article addresses the issues of short-term volatility, the non-equivalency of traders and, how product development is being impacted by market consistency.

Description: These are the appendices to the research report entitled Longevity Risk Quantification and Management.

Description: In this inaugural, rotating-author column from CERAs Chartered Enterprise Risk Analysts, Minaz Lalani provides insights into the different actions that key stakeholders governments, employers, markets/financial institutions and individuals can take to manage the systemic risks that affect retirement systems in the current environment.

Description: A review of the book WE: How to Increase Profits through Full Engagement.

Description: A roundtable discussion of the new international accounting standards and the possible implications for all insurers.

Description: Letter from the SOA president addressing the importance of volunteering. Also included are the responses from some volunteers who were asked various questions on the subject of volunteering.

Description: This article describes the insurance market in Greece.

Description: Volatility managed funds, which focus the measurement of an investor’s risk appetite on the volatility of the portfolio, have grown popular in the Asian markets recently, particularly in Japan. This article discusses a typical volatility managed strategy and presents performance comparisons between volatility managed funds and other comparable market strategies. The advantages of target volatility managed funds to investors and insurers are also included.

Description: 2011 Enterprise Risk Management Symposium, Chicago. This study investigates whether simulation-based models can be used to predict liquidity risk for banks, which must comply with Basel III by January 2015. The paper looks at the process of developing a measurement framework using Black-Scholes and Merton’s asset-based models to measure liquidity risk.

Description: 2011 SOA Enterprise Risk Management Symposium, Chicago. The stated purpose of this paper is to consider whether a more comprehensive and timely measurement framework for risk exposure is now needed and to examine one possible approach. This paper proposes a new approach to risk measurement that, along with capital measurement and more rigorous oversight, will allow banks an ability to manage risk.

Description: 'This paper looks at the issue of the timing the commencement of income annuities from the perspective of a real life client scenario.' From the 2011 Enterprise Risk Management Symposium, March 2011.

Description: Find out how to join the Entrepreneurial Actuaries Section LinkedIn Group.

Description: Research report describing the results of an Emerging Risks Survey conducted in 2010. This survey attempts to track the thoughts of risk managers about emerging risks across time. The new top five are: 1. Fall in value of US Dollar. 2. International terrorism. 3. Chinese economic hard landing. 4. Oil price shock. 5. Failed and failing states.

Description: Presented at the Living to 100 Symposium, January 2011. Long-term care LTC insurance is frequently not covered by national social insurance programs. When costs are expressed as a percentage of gross domestic product, the future burden of financing LTC would not lead to unbearable tax levels and is not particularly large in comparison to the projected costs for pensions and health care. After identifying the breadth of definitions of LTC needs, it is argued that LTC is an insurable risk. The paper concludes that LTC social insurance is affordable in developed countries.

Description: Presented at Living to 100 symposium, January 2011. This paper investigates dynamic properties of age trajectories of physiological indices and their effects on mortality risk and longevity using longitudinal data on more than 5,000 individuals collected in biannual examinations of the Framingham Heart Study original age group during about 50 subsequent years of follow up.

Description: Update on Health Section research projects and topics, including health care reform, complexity science, and strategic planning.

Description: In this article, the author discusses the need to create a systemic risk regulator.

Description: This is the Phase II report of a two–phase effort. The Phase I report, released in March 2009, consists of defining relevant and actionable consumer segments among middle–income/mid–level net worth households. This Phase II report defines a basic approach that could lead to a set of answers or 'solutions' that address the retirement risks faced by each segment. A second objective of Phase II is to provide insight regarding the nature of the retirement risks faced by varying segments of consumers and suggestions for solutions that address those risks.

Description: This article focuses on how a risk appetite framework can help a company manage the “three-headed monster” and why a risk appetite framework is critical to effective business and risk management at both the corporate and product levels.

Description: Letter from the president discussing the SOA’s emphasis on communicating with employers.

Description: Research report that explores key factors associated with an insurer’s reputational risk and conditions that would generate incentives for insurers to behave in a way that causes loss of their positive reputation.

Description: This research provides a literature review on the topic of post-retirement financial strategies from the perspective of an individual who is approaching retirement age. The body of knowledge surveyed is the post-retirement financial strategies literature that is related to the risks of longevity, inflation, and investment. The literature sources are both academic and practitioner-focused. The end product is a documentation of and commentary on the state-of-the-art in the post-retirement financial strategies area. The intended audience is retirement professionals, and others, who need to be well informed about the current state of post-retirement financial strategies, as reported in the literature.

Description: This research report analyzed the effects of different types of informational interventions on annuity-related behavioral intentions and beliefs, such as estimated retirement age and life expectancy.

Description: This is a book review of Uncertain Times: A Chief Investment Officer's Journey, by Alton R. Cogert.

Description: In this article, the author discusses the trend towards an integrated approach to defined benefit plan funding and investments that is taking place in England.

Description: This document presents the detailed results of a literature search performed during December 2009 - February 2010 to find resources for the report Complexity Science – An Introduction and Invitation for Actuaries.

Description: An introduction to the field of Complexity Science. The report includes an overview of the field’s key results, detailed instructions for building Complexity Science models, examples of working models, review of practical models applicable to the work of actuaries, a literature review, and a discussion on how actuaries can apply Complexity Science in their work.

Description: This article discusses how the industry as a whole is revisiting its risk management strategies in the wake of the financial crisis.

Description: Discusses Phase 1 survey results from the SOA/RGA post-level term research project.

Description: In this article the author compares ERM issues, strategies and scenarios to the process of driving to work on a four-lane highway.

Description: This article discusses the system in systemic risk and suggests management approaches for dealing with systemic events.

Description: Discusses the interactions between dynamic lapses and interest rates in stochastic modeling for variable annuities.

Description: In this article, the author discusses the impact of moving to International Accounting Standards in Taiwan.

Description: This predictive modeling for life insurers introduction to the collection of essays provides additional detail to the overview of the Predictive Modeling for Life Insurers process and also the research project. The project is a collection of essays that examine how existing or new methods or models can be applied to the life insurance industry.

Description: This “Application of Predictive Models Techniques to Measure Dynamic Policy Holder Behavior in Annuity Contracts” paper by Towers Watson researchers is one of a collection of essays that examine how existing or new methods or models can be applied to the life insurance industry.

Description: Feature article announcing the original 13 universities named as centers of actuarial excellence. From the Actuary Magazine, April/May 2010 Vol. 7 Issue 2

Description: This predictive modeling for life insurers paper by a Deloitte research team is one of a collection of essays that examine how existing or new methods or models can be applied to the life insurance industry.

Description: This article focuses on risk mitigation strategies and intends to demonstrate how an organization, a financial institution in this case, realized significant positive impact on its bottom line by integrating risk management in its overall business development strategy.

Description: This survey of emerging risks attempts to track the risk manager population‘s thoughts about emerging risks across time. The top 4 emerging risks from this third iteration of the survey are: 1. US current account deficit/fall in US dollar. 2. Blow up in asset prices/excessive indebtedness. 3. Oil price shock/energy supply interruptions. 4. Chinese economic hard landing.

Description: The main elements of the current US, Canadian and proposed Solvency II regulatory capital regimes for property and casualty insurance companies are compared in this paper.

Description: Feature article summarizing a talk given by Andrew Lo at the SOA 2009 Annual Meeting on the credit crisis and why risk management failed to stop the excessive risk taking.

Description: Feature article discussing the variable annuity industry rebuilding and reinventing itself.

Description: New chairperson’s column discussing his goals for the Product Development Section.

Description: This series of articles provides an in-depth look at the activities of the SOA in 2009.

Description: A preview of the Society of Actuaries’ 2010 Health Meeting, June 28-30, at the JW Marriott Grande Lakes in Orlando, Florida.

Description: With the decline in traditional defined benefit plans, cutbacks in Social Security already legislated, and further ones possibly needed to maintain solvency, retirees increasingly must rely on their own ability to manage their retirement income. Relatively few retirees purchase annuities, leaving them with investment and distribution decisions concerning their accumulated savings. Increasing life expectancy and improved health at older ages raise the issue of whether people should consider postponing retirement as a way of assuring adequate resources during retirement. During retirement, they face complex issues concerning how to manage various risks. Increasingly, people planning for retirement have access to financial planning software, much of it available over the internet for free. This study, sponsored by the Society of Actuaries and the Actuarial Foundation, assesses the extent to which the retirement planning programs analyzed help users understand post-retirement risks.

Description: Final installment of a series on the evolution of risk management with a close look at high profile failed corporations.

Description: A research report that first defines ERM and provides the results of an applicable literature search with hyperlinks and then describes the current state of Enterprise Risk Management practices for health organizations. Areas covered: 1. Operational Risks. 2. Balance sheet risks. 3. Pricing discipline. 4. Asset risks. 5. Learnings. 6. Emerging risks.

Description: Case Study for Fall 2009 Exam AFE.

Description: A program of undergraduate research in actuarial science and financial mathematics has been implemented at the University of Illinois over the last two years. This program has included two National Science Foundation-sponsored research Experiences for Undergraduates [in Summer 2007 and Summer 2009] on the topic 'Stochastic Modeling in Actuarial Science and Financial Mathematics,' as well as a variety of academic-year research projects undertaken by current actuarial science majors. This paper summarizes the program's evolving experiences in providing research opportunities to undergraduates, and highlights some of the topics and issues arising from these research experiences.

Description: This report presents the results of a survey conducted in August of 2008 on foreign travel underwriting practices of reinsurance companies.

Description: Column describing the events of a recent Product Development Symposium 2009.