A Review of Policyholders' Reasonable Expectations

Abstract

The text of this paper, together with the abstract of the discussion held by the Institute of Actuaries on 25 February 2002, are printed in British Actuarial Journal, 8, IV, 705-755.

British Actuarial Journal celebrates its 20th anniversary

“…Huber & Verrall (1999) advocated a more theoretically based approach to actuarial economic models in preference to the empirical data-based time series approach of Wilkie (1995), Varnell (2011) gives further details of what this means in practice. At the same time as the theoretical developments, regulatory and consumer pressures constrained actuarial discretion in pensions and insurance (Needleman & Roff, 1995; Shelley et al ., 2002) so that payouts from long-term funds were more mechanically linked to investment performance. There followed a series of papers applying option pricing theories (also called market-consistent valuation) to many areas of actuarial work: pensions (Exley et al ., 1997; Head et al ., 2000; Chapman et al ., 2001), life insurance (Hare et al ., 2000; Hibbert & Turnbull, 2003; Sheldon & Smith, 2004) and general insurance (Cumberworth et al ., 2000; Dreksler et al ., 2015).…”