Life Assurance Primer: a Text-Book Dealing With the Practice And Mathematics ...
Life Assurance Primer: a Text-Book Dealing With the Practice And Mathematics ...
Henry Moir
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The effect of this method is to give to the life assured the benefit of the light mortality rates during the early years of the assurance, whether the selec- tion in any particular company is equal to the average or not. Where the selection is below the average, the net premiums calculated in this way become inadequate. In America, on the other hand, the table most frequently used for all ordinary classes of policies is the American Experience, the standard table pre- scribed by statute for val...uation purposes, and one which does not take into consideration the effect upon the mortality caused by the length of time for which persons have been assured. The table is found to represent with considerable accuracy the rates of mortality experienced in good average companies after the early selection period has passed. The use of a table of this kind, Digitized by Google EXTRA PREMIUMS* J2J while it may provide net premiums larger than those strictly necessary, is to give to each company the profit made from care- ful selection of the lives.
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