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Unformatted text preview: end of year Profit vector Survival probabilit y Profit signatur e 1 6695.38 6336.14 359.24 1 359.24 2 7560.11 7485.50 523.98 14547.34 1022.25 0.846455 865.29 3-17753.16 15408.2 1 1078.57-1266.38 0.799163-1012.04 Cash flow= Premium-Expense+Interest-Expected death cost-Expected surrender cost-Expected maturity cost Reserve at the start of year= 20000*1.06^(t-1)*A 57+t-1:3-(t-1) -Pnet* 57+t-1:3-(t-1) Pnet=20000*A 57:3 / 57:3 Interest on reserve=Reserve at the start of year*0.07 Reserve at the end of year= (t+1) Reserve at the start of year*survival probability Profit vector=cash flow+Reserve at the start of year+Interest on reserve-reserve at end of year Profit signature= profit vector*survival probability...
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This note was uploaded on 06/12/2011 for the course ASB 1001,2522, taught by Professor Nicole during the One '09 term at University of New South Wales.
- One '09