CH 1: Actuarial Advice Flashcards
1
Q
Clients (consumers/beneficiaries) (6)
A
- Policyholders
- Prospective policyholders
- Members of benefit schemes and their dependants
- Employers
- Members of investment schemes
2
Q
Clients (providers) (2)
A
- Employers
- Insurance companies
- Trustees of benefit schemes
3
Q
Clients (owners/managers of providers) (3)
A
- Board of directors
- Shareholders
- Investment fund managers
4
Q
Clients (providers of capital) (4)
A
- Creditors
- Sponsors of capital projects
- Sponsors of benefit schemes
- Banks
5
Q
Clients (Regulatory position) (2)
A
- Auditors
- Government
6
Q
Important things to consider when giving advice (4)
A
- Identify all stakeholders involved
- Retain a sense of proportion of the interests of certain stakeholders
- Omitting certain stakeholders may distort the context of the advice
- Not all stakeholders directly involved in remunerating the actuary for advice
7
Q
Interest of current/prospective policyholders (3)
A
- Personal protection against death and illness
- Protection of property
- Investment
8
Q
Interests of current/prospective policyholders (3)
A
- Personal protection against death or illness
- Protection of property
- Investment
9
Q
Interests of members of benefit schemes and their dependants (1)
A
- Provision of benefits on future events such as death, retirement, illness and withdrawal
10
Q
Interests of employers (7)
A
- Protection against financial loss arising from the death or ill health of employees
- Protection of assets
- Provision of work related benefits that will attract and retain good quality employees
- Meeting legislative requirements
- Managing the costs of running the business
- Quantification of the amount of surplus capital in the business
- Investment of surplus capital
11
Q
Interests of insurance company board of directors (8)
A
- Meeting legislative requirements for the management of the business
- Investing and managing the assets of the company
- Managing the liabilities of the company
- Determining the level of provisions to hold to meet future liabilities
- Setting premium rates
- Meeting policyholders’ reasonable expectations
- Good corporate governance
- Obtaining appropriate and adequate reinsurance to protect the business
12
Q
Interests of insurance company shareholders (1)
A
- Obtaining a good return on their investment and the return reflects the risk taken
13
Q
Interests of creditors (1)
A
- Certainty that monies owed to them will be paid
14
Q
Interests of trustees of benefit schemes (3)
A
- Managing the assets of the scheme
- Paying benefits promised under the scheme as they fall due
- Maintaining solvency
15
Q
Interest of sponsors of benefit schemes (4)
A
- Providing protection benefits that meet the needs of their members and their dependants
- Providing retirement benefits that meet the needs of their members
- Managing the cost of providing the benefits
- Meeting legislative requirements