A.1 Miscellaneous Reserves

Question 1

Accidental death Benefits

Answer 1

• ADB = when death occurs by accidental means defined in the contract
• calculated using the ADB mortality tables prescribed by SVL
  reserve = PV ADBs - PV NP from ADB
• this reserve calc is based on NLP which is assumed to be a constant % of GPs
• can be challenging if ADB is not easily separated from base policy
• reasonable approximations accepted

Question 2

Disability Waiver of premium benefits

Answer 2

reserve for approved claims ~= a disabled lfe annuity based on the tables in SVL with appropriate valuation IR
mean reserve = Premium waived * a (remaining)
- disability coverage may end before basic coverage

Question 3

Last to Die policies

Answer 3

two types:

1. traditional policy
   - pay a reduced DB or become paid up at the first death
   - after first death, the CV = calculated using single life values for remaining life
2. Frasier Type
   - no change in status at first death
   - CVs are calculated independently regardless of death status