MOCK EXAM LIFE INSURANCE ACTUARIAL CONTROLLING

The examination is open book. Each answer is worth one point.

Do all calculations with 6 significant digits even if the answer is given with fewer digits.
Write your answer without spaces, comas or apostrophes.
Use the full stop as a decimal separator.

Problem:
For a term insurance with face amount equal to 100000, taken out by a man aged 35 for 30 years with
payment duration of 8 years, with mortality SMSF98/03 and technical interest rate 1.5%, calculate the
pure annual premium (round your answer with one digit after the decimal). point

Answer:
1261.2

Problem:
For a term insurance with face amount equal to 1, taken out by a man aged 35 for 10 years with
payment duration of 8 years, knowing that the probabilities of death can be expressed by the following
polynomial: 1000𝑞𝑞𝑥𝑥 = 0.697 + 0.2638𝑥𝑥 − 0.01571𝑥𝑥 2 + 0.0002517𝑥𝑥 3 , and with the table below,
compute at age 35 (round your answer with 6 digits after the decimal point):
-the mortality rate
-the pure premium
-the pure provision
-the risk part of the pure premium
-the savings part of the pure premium

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Mock exam life insurance actuarial controlling 1

 x Dx Nx Sx Cx Mx Rx äx
i = 0,03
35 34693,64 791504,93 28101658,4 49,75 11640,04 1062450,01 22,8141218
36 33633,4 756811,29 27310153,5 51,49 11590,29 1050809,97 22,5017777
37 32602,29 723177,89 26553342,2 53,81 11538,8 1039219,68 22,1818127
38 31598,9 690575,6 25830164,3 56,68 11484,99 1027680,88 21,854419
39 30621,87 658976,7 25139588,7 60,08 11428,31 1016195,89 21,5198059
40 29669,89 628354,83 24480612 64 11368,23 1004767,58 21,1781988
41 28741,72 598684,94 23852257,2 68,41 11304,23 993399,35 20,829823
42 27836,16 569943,22 23253572,2 73,29 11235,82 982095,12 20,4749225
43 26952,11 542107,06 22683629 78,62 11162,53 970859,3 20,113715
44 26088,47 515154,95 22141521,9 84,36 11083,91 959696,77 19,7464608
45 25244,26 489066,48 21626367 90,47 10999,55 948612,86 19,3733736

Answer:
0.001477
0.002568
0.000000
0.001432
0.001136

Problem:
An endowment product with acquisition cost of 2.5% of the face amount 100000, and administrative
costs of 3‰ of face amount per annum for the whole duration and an additional 2% of premium per
year during premium payment of P’’=2618.72, and with 𝐺𝐺𝑅𝑅60 = −10, 𝐺𝐺𝐺𝐺60 = 38, 𝐹𝐹𝐹𝐹60 = 3, 𝐹𝐹𝐹𝐹60 =
91, calculate at age 60 (round your answer to the nearest unit):
- the loading G
-the loading F

Answer:
380
94

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Mock exam life insurance actuarial controlling 2

Problem:
A man buys an endowment product with a 35-year cover duration, and the premium payment duration
is 25 years. He is 35 years old. The face amount is equal to 100000. The tariff is calculated from
following technical bases: mortality SM 1998/03, technical interest rate 1.5%; loadings covering
acquisition cost of 2.4% of the face amount, and administrative costs of 4‰ of face amount per annum
for the whole duration and an additional 2% of premium per year during premium payment. With
P’’=3684.00, G=583.32 and F=116.80, calculate (round your answers to the nearest unit):
-the mathematical provision on administrative costs at age 55
-the mathematical provision on acquisition costs at age 55
-the mathematical provision on administrative costs at age 56
-the mathematical provision on acquisition costs at age 56
-the mathematical provision on administrative costs at age 59
-the mathematical provision on acquisition costs at age 59
-the mathematical provision on administrative costs at age 60
-the mathematical provision on acquisition costs at age 60
-the mathematical provision on administrative costs at age 64
-the mathematical provision on acquisition costs at age 64

Answer:
2662
560
2830
452
3364
117
3555

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Mock exam life insurance actuarial controlling 3

0
2229
0

Problem:
With the following assumptions, calculate the 7 components and the result at age 50 (round your
result with one digit after the decimal point):
Amount 100 000 x= 30 n= 35 k= 30
Cover: Endowment q = SM 1998/03 i= 1,50%
α= 2,40% of face amount b= 2,00% g= 0,30%
α∗ = 2,20% of face amount q* = SM 2008/13 i* = 3,00%
β* = 2,688930% g* = 0,166667%
u* 0 = 5,0% u* t = 0,080% (80 - t) [S] / V' = 85%

P= 2 545,90 F= 100,72 G= 395,93 P" = 3 042,55

x+t = 30 50 64 x+t = 30 50 64
PR x+t = 86,94 136,53 0,00 PE x+t = 2 458,97 2 409,37 0,00
GR x+t = -0,03 -3,10 0,00 GE x+t = 35,11 38,18 -300,00
FR x+t = 2,08 2,91 0,00 FE x+t = 98,63 97,81 0,00
tV = 0 57 358 98 522 t+1 V = 2 496 60 663 100 000
t (VF ) = 2 400 924 0 t+1 (VF ) = 2 336 839 0
t (VG ) = 0 841 300 t+1 (VG ) = 36 893 0
t V" = -2 400 57 275 98 822 t+1 V" = 196 60 718 100 000
q x+t = 0,0905% 0,3523% 1,3262% q* x+t = 0,0531% 0,2649% 1,0191%
u* t = 5,00% 4,80% 3,68%
[EM ]x+t =
[BM a ]x+t =
[EI ]x+t =
[BI α ]x+t =
[B α ]x+t =
[B γ ]x+t =
[ES ]x+t =
[E ]x+t =

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Mock exam life insurance actuarial controlling 4

Answer:
34.3
0.7
901.0
-12.3
0.0
114.1
403.0
1452.4

Problem:
In a portfolio of endowment contracts of a life insurance company, for a given fiscal year, we have:
-the total mathematical provisions of the life insurance company at the beginning of the year were
204253000
-premiums collected at the beginning of the financial year amount to 18502000 (where single
premiums amount 1000408)
-one million transfer of a portfolio of endowment contracts from another life insurance company on
the 1st of January.
-funds invested earned interest of 5.5%.
-there were four deaths for which the benefits paid reached 200000, whereas the total actuarial
provision for these four insureds at the end of the year would have been 108000.
-three surrender benefits were paid for an amount of 236000.
-the total management and acquisition costs charged to this portfolio amounted to 725000
-the total mathematical provisions of the life insurance company at the end of the year were
228038000.
What is the profit or the loss for that year? (round your answer to the nearest unit and write a sign
minus before the result if it is a loss)

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Mock exam life insurance actuarial controlling 5

Answer
6822650

Problem:
In a context of very high interest rate, a temporary life annuity was financed by a single premium
169360 for a four years annuity equal to 50000, starting in one year’s time. What is the internal rate of
return for the policyholder if he is alive at maturity? (answer in percentage and round to the nearest
unit).

Answer:
7%

Problem:
Complete the following text: for a life insurance policy, with interest rate of 1.5%, the annual premium
is equal to 3732, payable in three fractions of __________ each. On 01.09.2020, the mathematical
provision is equal to 50140. One year later, it is equal to 53115. Two years later, it is equal to 56474.
The interpolated mathematical provision is equal to __________ at 31.12.2020. With an annual
premium, we would have a provision for unearned premiums of __________; then S" = __________
and C" = __________. The interpolated reserve recorded in the balance sheet at 31.12.2020 is
__________. The estimated pure risk premium for this policy by the end of the year is equal
to__________. (round your answers to the nearest unit).

Answer:
1244
51132
2488
2488
0
51132
1395

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Mock exam life insurance actuarial controlling 6

Problem:
Define in a maximum of 10 words (not more!) Mortality Margin.

Answer:
Difference between conservative and realistic mortality tables.

Problem:
Consider Endowment type products. Due to the coronavirus pandemic, the mortality result is negative.
Due to the drastic decrease in interest rates, the interest result is negative. Fortunately, the
administrative and acquisition costs as well as the lapse rate were calculated according to reality. With
the natural allocation method, how much 𝛿𝛿𝑘𝑘 should be equal to?

Answer:
0

Problem:
For a term insurance with face amount of 100000, entry age 30, premium payment duration and cover
duration 20 years, the gross premium is equal to 415.12.
Best estimate (second order) bases are a mortality according to table SM 2008/2013 with an effective
interest rate of 3%; acquisition costs (during the first year) amount to 4‰ of policy face amount and
administration costs reach 240 per year. Calculate (round your answer to the nearest unit):
-the business premium
-the present value of future realised profits
The insurer will keep 12% of profits and starts profit sharing from the 2nd premium. For an allocation in
form of a deduction in % of premium; calculate (round your answer to the nearest unit):
-the profit sharing loading
-the unit present value of allocated profit shares
-the profit sharing rate, in percentage and rounded
-the value of that deduction

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Mock exam life insurance actuarial controlling 7

Answers:
369
703
41
15
10%
42

Problem:
A pension fund has a stable number of affiliates. It currently covers 3000 men and women of all ages.
The number of claims follows a Poisson's law of parameter 7.2. The expected value of aggregate claims
is equal to 2160000 and its standard deviation is equal to 967471.
-what is the claims frequency (round your answer with 4 digits after the decimal point)?
-find the expected value representing the individual claims amount knowing its standard deviation
equal to 200000 (round your answer to the nearest unit).

Answers:
0.0024
300000

Problem:
A pension fund is insured by a life insurance company which keeps 7% of expected claims for own
profit and 5% for administrative costs. With expected profit share equal to 380800 and expected value
of the aggregate claims (before applying the lognormal approximation) equal to 2160000, calculate
(round your answer to the nearest unit):
-the premium paid by the pension fund.
-the amount left for the life insurance company.

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Mock exam life insurance actuarial controlling 8

Answers:
2800000
259200

Problem:
A pension fund has a stable number of affiliates and is insured by a life insurance company. The
company offers a group cover to the pension fund with a gross premium of 2800000. With the profit
sharing formula of type: 𝑅𝑅 = (1 − 𝑓𝑓) ⋅ 𝑀𝑀𝑀𝑀𝑀𝑀� 𝜑𝜑 ⋅ 𝑃𝑃" − 𝑆𝑆; 0�, with parameters 𝑓𝑓 = 55% and 𝜑𝜑 =
85% and referring to the lognormal aggregate claim distribution, what would be the probability that
the aggregate claims amount is such that the pension fund would get more than 100000 as profit
share? (round your answer in percentage to the nearest unit).

Answers:
54%

Problem:
A pension fund has a stable number of affiliates. and is insured by a life insurance company. The
pension fund is not prepared to accept a premium higher than 3000000 and wishes a maximum profit
share up to 90% of premium. Given the profit share on average equal to 465234. How should then
Alienor modify the 𝑓𝑓 coefficient in order to get a technically balanced solution? (round your answer in
percentage to the nearest unit).

Answers:
30%

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Mock exam life insurance actuarial controlling 9