Data Flashcards
Main sources of data
RI RAIN
R: reinsurer
I: industry data
R: regulatory returns
A: accounts (published)
I: internal experience
N: national statistics
Reasons for poor data
*poor management control
*poor design of data systems
Good quality data
*well-designed, unambiguous, Same order as process on administration system
*capture uw results
*rating factors separately identified
*use policy data to check validity of claims data
Data issues - benefit scheme
- Actuary does not hVe control over data - needs validation
- Data not sufficiently detailed to provide all information that is financially significant for valuation
Sources of data checks
- Recon with prev valuation
- Accounting data vs assets
- Benefit outgo and contribution income
- Full listing of assets (permitted)
Data issues - summarised data
- Reduced reliability of valuation (can’t validate)
- Change in mix of members may remain unidentified
- Not useful for valuing options and guarantees
Industry wide data - useful
- Increase credibility of company data
- Provide competitor comparison
Industry data - not usefuls
4DEF
D: differences
* target market
*geography
*socio-economic
*policy conditions
*risk and rating factors
*uw and claims processes
*ways of storing data are different
D: dubious quality
D: detail (lack)
D: Date (out of date)
E: everyone doesn’t contribute
F: flexibility
Data checks
*reconciliation
*cross checks
*reasonable checks
*spot checks
Reconciliation
Totals (prev data and movements)
*total members and policies (and changes)
*tota benefit and premium
*recon of shareholdings at start and end of period - sales, purchases, bonuses
Cross checks
Accounting truths
* movement vs accounting (benefit payments)
* membership vs accounting (premium payments)
*asset vs accounting
(Investment returns)
*asset ownership vs custodian data
Reasonable checks
*SA and prem for book of business
*unusual values or missing data
Spot checks
*individual member/policy data
*assets and liabilities on given date
*asset and liability amount
*full deed audit for certain assets
