Pricing Assumptions

Pricing Assumptions

• Actually, all of us know it is one thing to build into your pricing assumptions a certain rate of return, but it is quite another thing to find out what rate of return you are actually experiencing.

—  Owen A. Reed

1981 – SOA – Effective Use of Capital, rsa81v7n312, Society of Actuaries – 24p 

• Premium Considerations
  • The non-guaranteed premium concept can be utilized for all forms of nonparticipating insurance, including both term and permanent policies.
  • In setting insurance premiums, the actuary can use pricing assumptions that are as realistic as possible.
  • The actuary is not locked into “50 years” of insufficient premiums if his or her estimates of future assumptions prove to be too optimistic.

—  Richard A. Swift – [Bonk: Aetna-?]

1980 – SOA – Nonparticipating Life Products with Nonguaranteed Premiums (rsa80v6n22), Society of Actuaries – 18p