Reservation of long-term care annuity (supplementary) insurance policies of the portfolio
Abstract
The Biometric Calculation Bases Working Group of the Life Insurance Committee of the German Actuarial Association (DAV) has dealt with the derivation of actuarially sufficiently prudent calculation bases for long-term care (supplementary) insurance in life insurance. In accordance with the ‘DAV 2008 P’ system of calculation bases applicable to new business from 2009 onwards, this paper publishes principles for the reservation of long-term care (supplementary) insurance policies already in the portfolio as at 31 December 2008.
This earnings report applies to the reservation of nursing care (supplementary) insurance policies in the portfolio as of 31 December 2008 for balance sheet dates from 31 December 2008 onwards.
Of course, every responsible actuary must check whether there are any company-specific circumstances that would prevent the unchanged application of the principles of this results report and the calculation bases derived therein for the provisioning of long-term care (supplementary) insurance. Similarly, the responsible actuary must decide whether the calculation bases can be used unchanged for the provisioning of a specific product. If necessary, the responsible actuary must make appropriate adjustments to the calculation bases.
In certain cases, other calculation bases may also be used for the reservation of nursing care (supplementary) insurance policies if there are convincing reasons for doing so. In this context, ‘convincingly justified’ means that the appropriateness of the calculation bases has been proven by the quality and significance of the data sources; the entire calculation basis system has been checked for internal consistency; and the structure and amount of the selected safety margins have been confirmed as appropriate by an analysis of the overall safety level generated.
The results report is addressed to the members and committees of the DAV for information on the status of the discussion and the findings achieved and does not represent a professionally legitimised position of the DAV.
