Verifiability of complex actuarial models: Evaluation of actuarial cash flows in life insurance

Abstract

The following explanations of the technical principle provide an overview of issues relating to the verifiability of complex actuarial models used to evaluate technical cash flows in life insurance. Procedures for demonstrating appropriateness are described and the use of simplifications and good practice approaches are discussed. This overview is intended only as a preliminary guide and does not replace consideration of the technical principle.

This professional principle applies in particular to actuaries who are involved in the preparation and/or audit of the annual financial statements of a life insurer.

For other issues (e.g. modelling in the context of M&A activities), the paper can also be consulted if necessary.