Question

What are the stages involved in the cash flow method for determining premiums?

a.

Setting commission rates and initial expenses

b.

Determining expected income and outgo for each policy year

c.

Calculating investment returns and renewal expenses

d.

Assessing optimistic and pessimistic scenarios

Posted under IC 92 Actuarial Aspects of Product Development

Answer: (b).Determining expected income and outgo for each policy year Explanation:The stages involved in the cash flow method for determining premiums include determining expected income and outgo for each policy year.

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Q. What are the stages involved in the cash flow method for determining premiums?
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