2007 General Meeting Assemblée générale 2007 Montréal, Québec 2007 General Meeting Assemblée générale 2007 Montréal, Québec Canadian Institute of Actuaries.

Présentation au sujet: "2007 General Meeting Assemblée générale 2007 Montréal, Québec 2007 General Meeting Assemblée générale 2007 Montréal, Québec Canadian Institute of Actuaries."— Transcription de la présentation:

1 2007 General Meeting Assemblée générale 2007 Montréal, Québec 2007 General Meeting Assemblée générale 2007 Montréal, Québec Canadian Institute of Actuaries Canadian Institute of Actuaries L’Institut canadien des actuaires L’Institut canadien des actuaires

2 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 T100 and UL LCOI Lapse Studies Results Lloyd Milani Nikolai Serykh November 30, 2007

3 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Agenda UL LCOI Industry Pricing – 2006 Munich Re Survey Lapse Studies Highlights Scope and Method Results

4 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL LCOI Industry Pricing 2006 Munich Re Survey – Sales and Funding – Lapse and Interest – Profit

5 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL Level COI Sales

6 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL Level COI Funding Level

7 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL LCOI Pricing Lapses

8 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL LCOI Lapse and Interest

9 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL LCOI - Profitability

10 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 T100 and UL LCOI Lapse Study 2007 Request for data - Beginning 2005 Enhanced Fields – Cash Value – NAAR Pattern – UL Deposit Results Database

11 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Working Group Nikolai Serykh Elena Stoyanova

12 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Individual Life Subcommittee of the Research Committee Lloyd Milani, Chairperson Stephen Beal Marc-Andre Belzil William Brath Emile Elefteriadis Beth Fitzmaurice Marc Tardif

13 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Agenda UL LCOI Industry Pricing – 2006 Munich Re Survey Lapse Studies Highlights Scope and Method Results

14 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Participating Companies AIG Canada Life Co-operators Life Desjardins Empire Life Industrial Alliance Manulife Financial Standard Life Sun Life Transamerica Life Wawanesa Top 5 companies contribution to total policy exposure: 97% for T10086% for UL LCOI

15 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Highlights – T100 Study 1999-2004 Period 92,587 lapses – Duration 1-10 - 73,064 lapses – Duration 11-20 - 19,594 lapses – Duration 21-25 – 156 lapses Over 4.0 million policy exposures Over 251 billion face amount exposure Compared to 1999 T100 Lapse Study – 204.5% of exposure by policy – 139.0% of exposure by face amount

16 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Highlights – UL LCOI Study 2002-2004 Period 103,049 lapses – Duration 1-5 - 74,972 lapses – Duration 6-10 - 24,526 lapses – Duration 11-15 - 3,551 lapses Over 2.1 million policy exposures Over 304 billion face amount exposure Compared to 2003 UL LCOI Lapse Study – 167.0% of exposure by policy – 149.0% of exposure by face amount

17 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Method Calendar year method Exposure period as provided by company without modification Following Status codes included – Active – Death – Lapsed and Surrendered

18 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Scope Results by Number and by Face Amount Durations 1-25 for T100 and 1-15 for UL – Total – Calendar Year – Sex and Joint – Smoking Status – Policy Size – Issue Age – Premium Frequency – Cash Value Availability (T100 only)

19 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 T100 Lapse Study Results Total Calendar Year Sex and Joint Smoking Status Policy Size Issue Age Premium Frequency Cash Value Availability Comparison to – 1999 Term-to-100 Lapse Study

20 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Term-to-100 Study

21 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 T100 Study by Calendar Year

22 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 T100 Study by Sex and Joint Status

23 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 T100 Study by Smoking Status

24 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 T100 Study by Policy Size

25 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 T100 Study by Issue Age

26 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 T100 Study by Premium Frequency

27 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Term-to-100 Study by Cash Value Availability (1)

28 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Term-to-100 Study by Cash Value Availability (2)

29 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Term-to-100 Study 1999 vs 2007 Composite Rates at Durations 1-15 1999 vs 2007 without Cash Value

30 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 T100 Study – 1999 vs 2007

31 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 T100 Study 1999 vs 2007 without Cash Value

32 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL LCOI Lapse Study Results Total Policy Size Comparison to – 2003 UL LCOI Lapse Study – 2007 Term-to-100 Lapse Study – Munich Re Pricing Survey

33 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL LCOI Lapse Study

34 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL LCOI Lapse Study Policy Size

35 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL LCOI Study – 2003 vs 2007 Overall Differences

36 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL LCOI – 2003 vs 2007

37 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL LCOI Study – 2003 vs 2007 Differences Different Study Periods: – 1997-2001 vs 2002-2004 Shift in Participants Contribution Change in Sample Demographic: – Male = -0.8% Female = +5.6% – Joint 1 st to Die = -1.2% – Joint 2 nd to Die = -3.6%

38 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL LCOI vs Term-to-100 Composite Rates at Durations 1-15 Non-Smoker, Single, 100K+ Band, Monthly Premium Mode

39 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL LCOI vs Term-to-100

40 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 UL LCOI vs Term-to-100 NS, Single, 100K+, Monthly Mode

41 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Munich Re Pricing Survey 2002 Assumptions vs 1997-2001 Experience 2006 Assumptions vs 2002-2004 Experience

42 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 2003 UL vs MRe Survey 2002 Issue Age 25-35

43 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 2007 UL vs MRe Survey 2006 Issue Age 25-34 (1)

44 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 2007 UL vs MRe Survey 2006 Issue Age 25-34 (2)

45 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Conclusion Careful with experience where exposure is limited Lapse Rates pattern are similar in both studies T100 lapse rates are lower than UL LCOI after duration 8 UL LCOI composite experience is in line with average pricing and valuation assumptions Average pricing and valuation assumptions are generally higher than actual experience for UL Non-Smoker, Single, Band 100K+, Monthly Premium Mode

46 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Limitations Not every company was able to contribute each experience year Basic Policies only Limited Amount of Exposure T100 Data – Date of Cash Value on set – Premium Cease Date UL YRT COI changes to Level COI Partial Lapses Increasing Face Amount

47 2007 General Meeting Assemblée générale 2007 2007 General Meeting Assemblée générale 2007 Questions