bluuebunny/crossref_metadata_2025 huggingface dataset:
Superannuation Funds: a Brief Survey, and Notes on Some Current Problems, with Special Reference to the Funds of Local Authorities
Authors: Porteous D. A.
Published: July 2016

Nearly twenty-five years have passed since Sir George Epps read his important paper at the Institute of Actuaries on the post-war problems affecting superannuation funds.

In the interval there have been many changes, great developments in the establishment of funds and another world war. Our victory in the war is now assured and although, at the time of writing, its concluding date is not known, it seems not inappropriate to invite actuaries to review the position of superannuation funds, and while I am very conscious of the inadequacy of the notes which I am privileged to submit to this meeting, I am confident that the ensuing discussion will not fail to be of profit to the profession.
The Role of Statistics in the Furtherance of Medical Research
Authors: Crew F. A. E.
Published: July 2016

Synopsis

The wartime development of Army medical statistics has yielded a new vision of how statistics can serve and advance medicine in the interests of society as a whole.

The abundant and unique opportunities which the Army has provided have served to emphasise a function of medical statistics which though fully recognised by the actuarial profession has hitherto been largely disregarded by the medical. Statistics should clarify our views about what aspects of health and disease have the most pressing claims on national expenditure for research or preventive policy.

Army experience has suggested a new approach to the problems of civilian health statistics. It can provide an answer to the question as to which is the greater need: (a) a more widespread recognition of how statistical techniques can advance medical knowledge; or (b) a vigorous attack on the problem of making more informative and reliable data available for statistical interpretation by creating appropriate administrative machinery.

This theme is thereafter developed and suggestions are made as to methods which might be adopted to create the necessary machinery through collaboration between organisations already in existence.
Mortality Options in Life Assurance
Authors: Elderton William P.
Published: July 2016

Synopsis

The paper gives an attempt at studying the effect of options under convertible Term Assurances by sub-dividing the assumed mortality into sections, some of which will have a light and others a heavy mortality, and seeing what would be the effect if the sections with the heavier mortality convert the assurances to a greater extent than those with a light mortality. (cf. Frank L. Griffin, jnr., in The Record (American Institute of Actuaries), vol. xxxi. pp. 374 et seq.)

A similar method is also used to examine the option to surrender a whole life assurance and the option to continue a child's deferred assurance.
Legal Aspects of Life Assurance Policies
Authors: Robertson F. W.
Published: July 2016

In this paper I should like to discuss a few legal questions which arise in connection with life assurance policies. For the sake of simplicity I shall assume that I am dealing with a mutual life assurance society constituted by Act of Parliament.
Insurance Against Inflation
Authors: Recknell G. H.
Published: July 2016

Synopsis

The object of the paper is to draw attention, for the first time at an actuarial meeting, to the effects of continuing inflation on the proceeds of life policies and to discuss the possibility of devising some means of amelioration.

The course of commodity prices is examined from the beginning of the nineteenth century to the present time, and examples are given of the effects of inflation on policies effected in 1904 and maturing for payment in 1924. Reference is made to the experience of Germany and Austria during the currency debacle of 1922 and 1923.
Pension Funds: Some Practical Points
Authors: Heywood G. , Marples W. F.
Published: July 2016

Synopsis

The object of the paper is to consider a number of practical points with which the authors have to deal in their day-to-day work in giving advice on Pension Funds.

Among the problems discussed are the construction and use of salary scales together with a development of the theory of salary scales which adds greater flexibility to current practice. The mortality of pensioners and the effect of geographical distribution on such mortality is examined and a practical method of dealing with the mortality of ill-health pensioners is given. Reference is also made to the valuation of returns on death after retirement and some practical aspects of Stationary Funds.

Throughout the paper emphasis is placed on simplicity, both in theoretical treatment and in the practical application.
Summation and Some Other Methods of Graduation – the Foundations of Theory
Authors: Elphinstone M. D. W.
Published: July 2016

Synopsis

Several methods of graduation depend on linear operators–that is, operators of the type …+λ−nE−n+‥+λ0+…+λnEn+… Few attempts have been made to compare these methods, and there is no general theory. There is need for such a theory, for it is easy to show that unless some relation is assumed to hold between neighbouring graduated rates, there is no justification for graduating at all. Any such theory must explain this relation, which cannot be of the simple type that leads to curve fitting.

The paper has two objects : to compare and judge these methods, and to devise a general theory applying to them all.

The first approach is by the classical method–separate examination of fidelity and smoothness.
An Actuary in Commerce
Authors: Turner N. C.
Published: July 2016

Synopsis

The Paper reviews the growth of the number of actuaries in Great Britain, with particular reference to the last fifty years, and analyses the development in the scope of their employment, both inside and outside the insurance world. Reference is made to the natural hopes and ambitions of the newly qualified actuary, following completion of his long and arduous period of training, and to the responsibilities of a professional organisation.

Consideration is given to the growth of the employment of actuaries in England in industry and commerce, and reasons are suggested for their success in those spheres. Opportunity is taken to bring up to date certain tables first quoted by F. A. A. Menzler in J.I.A Vol. 57 and comment is made on subsequent references in actuarial literature to the problems of expansion in the scope of professional employment.

The second (and greater) part of the Paper includes a series of examples in which a detailed explanation is given of problems which have faced the author in the business with which he is connected–food distribution through a multiple shop organisation–and of the methods by which they have been solved. Whilst the solution in some cases depends upon the direct application of actuarial or statistical technique, emphasis is laid on the value of the form of mental process inculcated by actuarial training rather than on the direct use of technique.
Nomograms
Authors: Cooksey W. J.
Published: July 2016

The use of graphical methods is familiar to all actuaries, but the particular form of graph known as a “Nomogram” probably is still little known to most members of our profession. This form of graph does not appear in the set Courses of Reading for the examinations of either the Faculty or the Institute of Actuaries, though the latter body does not now (as it did until recently) specifically exclude “Determinants,” a form of algebraic expression from which nomograms may be developed.
Occupation Mortalities
Authors: Dunlop James Craufurd
Published: July 2016

Mr. President,—It is in response to your invitation that I venture to submit to this Faculty a paper on the Influence of Occupation on Mortality. I have no fresh statistical observations to lay before you, but the task I have set myself is to elaborate the observations set out in the Supplement to the Registrar-General of England and Wales' Sixty-fifth Report, part II., a report which was published early this year. That report may rightly be described as the most important contribution to our knowledge of the subject which has yet been published, and it is thanks to the excellent tabulation of facts in it that I am able to deal further with them.

Before asking your attention to the subject proper of my paper, an examination of the results of the recent English study, I desire briefly to describe previous statistical observations on the subject, to indicate to you some of the difficulties and limitations in drawing satisfactory conclusions from these studies, and to explain the methods which have previously been used to overcome these difficulties, and methods which I now use for the first time.
The Expectation of Life in Circulatory Disease
Authors: Gibson G. A.
Published: July 2016

The subject with which you have invited me to deal on this occasion is one of great importance, but it is hedged about by so many uncertainties that it is of more than ordinary difficulty. Many attempts have been made to solve the problems which arise from its consideration, and it may possibly be regarded as almost outworn; yet, with the growth of knowledge in the present day, it is one which permits useful reconsideration.
Corporate Executors and Trustees
Authors: Anderson Thomas Frederic
Published: July 2016

Insurance offices are so largely interested in Trust Estates, and so many Companies are now transacting the business of Executor and Trustee, that I feel no apology is required for these notes, even though the subject may be somewhat outside the range usually covered by papers read before the Faculty.

Up to the present this class of business has developed almost entirely in England, although a certain amount has been transacted in Ireland, and a small number of settlements made in Scotland have been passed over to Companies. This must be my excuse for having dealt almost entirely with English Law. There are, however, some notes as to the corresponding practice in Scotland, For these I have to thank my friend Mr. David W. Marwick, W.S., for whose assistance and advice I am most grateful.
Research in Life Assurance
Authors: Orr Lewis P.
Published: July 2016

The paper which I have the honour of submitting to the Faculty may be briefly described as a plea for Research in Life Assurance, with the object of throwing light on many of the problems which arise in connection with the practical work of our business.

As the most satisfactory way of obtaining successful results it advocates the establishment of a Bureau of Research—preferably of a permanent nature.
On Rates of Premium for Discounted Bonus Assurances
Authors: Richmond George William
Published: July 2016

The successive stages in the history of life assurance business are closely associated with certain developments of actuarial science, and in particular with the appearance of the great Life Tables, the Northampton, the Carlisle, the Seventeen Offices, and the Twenty Offices experience. More recently the British Offices experience of 1863-1893 has been published, and it can by no means be asserted that all the lessons to be derived from this important mass of statistics have been learnt. Many valuable opinions have been expressed on particular points, in Great Britain, in North America, and elsewhere, but as a rule any proposals as to rates of premium would appear to have left some appreciable margin for adverse contingencies as regards allowance for mortality, for interest, and for expenses. Yet in the practical conduct of business under competitive conditions, the problem that ever presses for solution touches closely the present actual cost price, and although this may be but a will-o'-the-wisp, and undoubtedly varies greatly in different circumstances, it is probable that experienced actuaries will always find features worthy of discussion in connection with it.
Peerage Males—Statistics of Mortality, First Marriage, and Issue
Authors: Hunter Robert Marshall
Published: July 2016

I have the honour of submitting to the Faculty the results of investigations into the rates of mortality among Males and into the rates of mortality, marriage, and fruitfulness of marriage among Bachelors of the British Peerage in the latter half of the nineteenth century.
Female Mortality
Authors: Fyfe Austyn J. C.
Published: July 2016

The primary object of this paper is to inquire into, and bring forward for discussion, those characteristics of the mortality of female lives which belong to their sex as a whole, in the belief that a proper understanding of those characteristics is essential to a correct interpretation of statistics derived from the special class represented by assured lives. To this end an attempt is made, in the earlier part of the paper, to compare the available statistics of assured lives with those of the general population, and some apology perhaps is needed for the space which it has been found necessary to devote to this part of the subject. This, however, is to a great extent unavoidable, and is partly due to the necessity of showing the figures for male lives side by side with those for females, thus involving generally a double set of figures in each table.
On Annual Valuations and Distributions of Profit, with Some Remarks on the Construction of Office Premiums
Authors: Denham Walter , Granger Charles Keith
Published: July 2016

The annual valuation of liabilities independently of the interval between successive divisions of profit, an improvement in practice now general among Life Offices, may be attributed immediately to the altered distribution of assets, but is to be referred ultimately both to the persistent decline in the rate of interest during the twenty years previous to 1899, and to the steady increase in the funds of the companies, for the extended powers due to these joint influences led (for obvious reasons) to the investment of an increased proportion of the funds in Stock Exchange securities, and to a decrease in the proportions invested in ground rents and feu-duties or lent on direct mortgage.
The Expectation of Life in Scotland in the Year 1911
Authors: Dunlop James Craufurd , Hunter Robert Marshall
Published: July 2016

The Life Tables which we have prepared and have now the honour of submitting to the Faculty, are based on the Male and Female Populations of Scotland as ascertained by the Census taken on 2nd April 1911, and on the average of the deaths registered in Scotland during the years 1910, 1911, and 1912.

In having used the censal population for the purpose of this study, and not a middle year estimate of the population, we lay ourselves open to some criticism, as a middle year estimate is more generally approved of for this purpose.
Report by the Council, 1916
Authors: Low Geo M.
Published: July 2016

The Council have pleasure in submitting their Annual Report.

At the last General Meeting certain changes were made in the Rules and Regulations regarding Examinations, but in November the circumstances occasioned by the War were such that the Council decided to abandon the Examinations which would in ordinary course have been held in April 1916. On this account it may be necessary before resuming the Examinations to make certain alterations in the dates mentioned in Bye-Law No. 5.
Some Aspects of Withdrawals in Ordinary Life Business
Authors: Patrick F. D. , Scobbie A.
Published: July 2016

Synopsis

The increasing competition from other forms of savings media which emphasise a favourable return on termination makes it desirable to reconsider the existing attitudes of the Life Offices to withdrawals. The aim of the paper is to discuss the current level of withdrawal rates and associated benefits for ordinary life assurance contracts.

In Section I a method of determining crude withdrawal rates is demonstrated and in Section II some of the factors which influence these rates are discussed.

The effect on immunization theory of the introduction of the concept of “contractual” withdrawal benefits is considered in Section III and in Section IV the current levels of withdrawal benefits and the margin for contingencies and profits are examined.
Actuarial Programming Methods
Authors: Robertson E. S. , Wilkie A. D.
Published: July 2016

Synopsis

Little has been written about the ways in which computers can be used to deal with specifically actuarial problems, as opposed to data processing ones. The development of “higher-level” computer languages has enabled algorithms to be written in the form of programs which are reasonably intelligible, and with the use of one such language, Algol, the paper sets out to show how a variety of actuarial problems can be tackled.

Section 2 describes Algol in sufficient detail for the programs shown in the paper to be understood. Numerical Analysis is discussed in Section 3, which gives algorithms for some problems in Finite Differences, and Section 4 suggests the kind of program subroutines that may be required for statistical work. Part of the present Faculty Part II syllabus is dealt with in Sections 5 and 6 while Section 7 discusses the use that could be made of modern mathematical techniques, with the aid of the computer, in the problem of curve-fitting. Section 8 deals with the question of up-to-date actuarial notation and in Section 9 reference is made to two special column-processing computer languages, specially written for actuarial work, which are in use at the present time.
Allocation of Surplus in a Mutual Life Office
Authors: Calder A. N. , Shedden A. D.
Published: July 2016

Synopsis

This paper sets out to demonstrate a set of principles for the allocation of surplus in a mutual life office.

Surplus is defined as a capital item and the principles governing its measurement and allocation are developed without regard to the method by which surplus may be distributed in the form of cash or additional guaranteed benefits. Particular attention is paid to the special problems arising where there is substantial investment in equities or where a substantial portion of surplus comes from the profits of without profits business.
Risk Theory
Authors: Plackett R. L.
Published: July 2016

I hope that you will bear with me because I am just one of these statisticians who does not know anything about business and industry and, consequently, it is perfectly obvious that my approach is rather an academic one. However, I have come here to talk to a document which you now have in front of you, and I would like to work through it and talk a little more than is given on the paper about some of the points which arise as we proceed.
Mortality Models and Their Uses in Demography
Authors: Brass W.
Published: July 2016

Synopsis

The search for functions which describe how mortality varies with age is an old one. Over the past two decades demographers have developed model life tables based on the structure of relations among mortalities in different populations rather than explicit expressions of age. The earlier work was analytic and empirical using techniques of statistical regression but more recently functional models have been constructed. These developments are described with particular concentration on the logit relation families of curves.

Some uses of the model life tables in demography are examined such as mortality projections, the dynamics of age structure and estimation from the limited data of developing countries. The implications of the logit system for certain of the “classic” speculations are considered—the span of life, whether a generation carries its own mortality with it and the accumulation of the unhealthy at older ages with saving of life at the younger.
Recent Mortality Trends: Some International Comparisons
Authors: Giles P. , Wilkie A. D.
Published: July 2016

Synopsis

This paper continues the work presented by Gwilt to the Centenary gathering of the Faculty in 1956 and extended by Anderson & Whitehead at the Sixteenth International Congress of Actuaries in 1960. For twenty-two countries death rates for each sex are given for quinquennial age groups between 15 and 84. Five periods centred on equidistant points in the interval 1950 to 1970 have been employed to permit ratios to be tabulated showing the improvement or worsening in mortality in each age group for any part of this period of twenty years. At some ages mortality has clearly worsened over the period, especially for males between 60 and 75.

A graphical method of examining the trend of mortality at each age over the last 150 years is illustrated; this is based on a model system of calendar year life tables.

A comparison with some assured lives mortality shows a greater improvement among assured lives than for the male population as a whole. Comparison of each country with the average for all countries and comparisons of mortality sex ratios bring out some points of interest which confirm the general trend.

An analysis by age, sex and cause of death covers all twenty-two countries in or around 1965, and four of them in 1955 in order to continue the figures given by Gwilt for 1936 and 1950. This analysis picks out the major reasons for the changes in over-all mortality and highlights the differences between sexes by giving ratios for each sub-group. The increases in certain countries in mortality from lung cancer, heart disease and motor vehicle accidents are noted.

The paper finishes by considering the effect of worsening mortality rates on endowment assurance premium rates.
Scottish Life Tables, 1921
Authors: Dunlop James Craufurd
Published: July 2016

I Have the honour to submit to the Faculty six Life Tables based on the population of Scotland as ascertained at the Census of 1921 and on the deaths registered during the years 1920 to 1922. Of the six Tables three deal with the male population and three with the female population, the three of each sex consisting of a general Table, a Table applicable to the married, and one applicable to the unmarried. The widowed population and deaths of widowers and of widows are included with those of the married.
Scottish Bankers' Mortality and Marriage Experience, 1903–1923
Authors: Fraser Alexander
Published: July 2016

Synopsis of Paper

Investigation into experience from 1903 to 1923 of five Scottish Banks' Widows' Funds; Bachelors, Married Men + Widowers, Wives and Widows, dealt with separately for mortality (total exposed to risk 99,354, 1305 deaths); Bachelors and Widowers separately for marriage experience (757 marriages).

Description pf methods of obtaining Exposed to Risk, etc., with special reference to exclusion of War period for younger male lives.

Males:—Low mortality at younger ages ; same improvement not maintained at older ages ; Bachelor mortality much higher than for Married Men at all ages. Females :—Exceptionally light mortality at younger ages ; improvement continued to some extent to oldest ages. Comparisons made with Hewat's 1893 experience.

Marriage:—Rates for Bachelors less than Hewat's at early ages, higher at principal marrying ages, and then again lower. Rates for Widowers much higher than for Bachelors. Difference between ages of husband and wife at marriage of Bachelors three years less than by Hewat.

Comparisons of Monetary Values—Whole Life Annuities and Annuities to Widows by first and second Marriages of Bachelors, etc.—with values by Hewat and Huie.

Valuation of Fund by new tables compared with valuation by Hewat and Huie ; reserves very similar for old-established Fund ; liabilities for young Bachelor entrants lighter.

Collective method, based on deaths in period. Liability in Valuation substantially lower than by Reversionary Annuity method; examination of difference, traced mainly to effects of War on marriage status. Discussion of the two methods, with references to Schjoll's alternative Collective method, based on living at end of period.

Tables at 3, 3½, and 4 per cent.; all tables given by Hewat and Huie relating to payments on marriage and to widows' annuities. Collective Method ; tables at 3½ per cent.
The Mortality Aspect of Population Projections
Authors: Tutt L. W. G.
Published: July 2016

Synopsis

The paper takes as its basis the mortality aspect of population projections with particular reference to this aspect of the report by the Royal Commission on Population (Cmd. 7695), and the Reports and Selected Papers of the Statistics Committee published as Volume II of the Papers of the Royal Commission.

The alternative assumptions regarding future mortality adopted by the Statistics Committee for use in their published population projections and the effects of the assumptions on those projections are discussed. The paper considers also the generation approach, the ultimate irreducible level of mortality approach, and remarks are made on the analysis of mortality according to cause of death. Further, general consideration is given to a number of factors the precise extent of the influence of which on future mortality is unknown, to demonstrate the insufficiency of a single forecast of mortality when dealing with the problem of population projections.

The conclusion is arrived at that neither of the mortality assumptions adopted by the Statistics Committee was at the time an extreme assumption, but that from considerations of the mortality aspect alone this Committee extended their projections too far into the future. The opinion is reached also that a method which makes some allowance for a generational influence would have been a suitable alternative to the declining mortality method adopted, for obtaining a not extremely light estimate of future mortality. The ultimate irreducible level of mortality approach is concluded to be impracticable at the present time, although the view is formed that the results of analyses of deaths according to cause of death should be of value when considering future population mortality.
Some Actuarial Aspects of a Benevolent Fund
Authors: Baker A. C.
Published: July 2016

Synopsis

The author refers to two types of insurance cover which may be obtained to meet the heavy expenses incurred in serious illness—firstly, the income maintenance cover provided by friendly societies and by the permanent sickness and accident policies of insurance companies, and secondly, the indemnity provided against certain specific expenses of illness which is provided by a number of private non-profit-making associations. A description is given of the benefits generally provided by these latter associations, and a number of restrictions which may govern the payment of benefits are enumerated.

The author proceeds to give details of the Benevolent Fund of a large company which provides sickness benefits similar to those provided by the private associations but subject to none of their limitations.

The sickness experience of the Fund is investigated for each of the last three quinquenniums covering the period 1934–48 and also for the period 1949–51, and mention is made of problems arising in the collection and setting out of the data.
The Growth of Pension Rights and their Impact on the National Economy
Authors: Bacon F. W. , Benjamin B. , Elphinstone M. D. W.
Published: July 2016

In January 1952 the Councils of the Faculty and the Institute, having in mind the widespread feeling that the growth of pension commitments in relation to the national income is a matter of major public policy, decided to invite a small research group to prepare a study of the subject.
The Profitability of Group Pension Business: An Essay in Assessment
Authors: Stalker Alastair C.
Published: July 2016

Synopsis

The Paper sets out to examine whether existing group pension business written on certain premium bases will prove to be profitable or not. In the first part of the Paper the trends and effects of mortality, interest, income tax and expenses are examined in turn and a table of annuity values is constructed embodying the conclusions drawn.

In the second part of the Paper the working of a model group pension scheme for the year 1955 and the results of the year's working are analysed, firstly according to the assumed experience basis, and secondly according to the premium basis.
With-Profits Group Pension Schemes
Authors: Elphinstone M. D. W. , Melton M. W.
Published: July 2016

Synopsis

A small but growing number of life offices are willing to allow participation in profits to group pension schemes. Well-designed schemes, whether with- or without-profits, satisfy quite different requirements from ordinary policies; these requirements are first examined with special reference to their effects on the design of with-profits schemes. Thereafter, certain general actuarial questions are discussed which an office must settle against the background of its own policy and circumstances, once it has decided in principle to transact with-profits schemes. Different possible types of scheme are then considered in the light of these discussions, with special reference to bonus systems and costing plans, and to the prospects of successful competition with without-profits schemes. The paper ends with a short survey of misunderstandings which an office should guard against in dealing with the public.
Are We Investing Enough
Authors: Cairncross A. K.
Published: July 2016

Mr. President and gentlemen, I should like to express my pleasure at being back in the Faculty Hall, where I was privileged to listen to your interesting discussion last year on “The Growth of Pension Rights”. I am glad to find that the number of occasions on which economists and actuaries are not only on speaking terms but able to take counsel of one another is increasing, for I am sure that there are many problems, of which the future of pensions is only one, that can only be satisfactorily resolved through our joint efforts and deliberations. This conviction rests partly on my experience as a member of the Phillips Committee, which was heavily dependent both on the actuaries who served on it and on the members of the profession who, in one way or another, helped it along; but it is a conviction that is just as forcibly brought home to me when I look across the Atlantic to the inquiry that has been in progress since 1950 into the long-term trends in savings and investment in the United States—an inquiry carried out by economists but sponsored and largely financed by the Life Assurance Association of America.
Some Experiments With Net Premium Valuations
Authors: Beattie J. M.
Published: July 2016

Synopsis

The paper deals with the valuation of whole life and endowment assurance business in offices whose solvency is not in question and which are writing an expanding business.

A survey is made of the valuation methods and bases of major British life offices. A large majority of these offices use the net premium method for their published valuations and make these valuations on mortality and interest bases similar to those used in their current premium scales. A model office is used to study the provision for expenses made by net premium valuations. It is shown that the renewal expenses may often be less than the annual provision for expenses in the valuation, with the result that the valuation makes some provision for the initial expenses of new business.

Examples are given showing the rate at which surplus is released by net premium valuations in an expanding business and the rates of reversionary bonus provided are compared with the uniform rates supported by the premiums.

Further examples are given showing the rates of reversionary bonus provided by net premium valuations after changes in the experienced rates of interest, mortality and expense, and these reversionary bonuses are compared with the uniform reversionary bonuses supported by the reserves and the premiums under the new conditions.
Mortality in the Past Hundred Years
Authors: Gwilt R. LL.
Published: July 2016

Synopsis

The paper, which was written at the invitation of the Council of the Faculty for submission on the occasion of the Centenary celebrations, deals with the broad trend of mortality rates in the hundred years 1850-1950.

The paper is in five main parts :—

1. The political and social background of the period, in so far as it might affect mortality rates, is briefly discussed.

2. The trend of mortality rates during the hundred years is discussed principally with reference to the following six countries which, besides being relatively stable politically during the period, have recorded mortality rates throughout—

England & Wales

Denmark

France

Netherlands

Norway

Sweden.

The experience in more recent years of a number of other countries is also discussed.

3. The relationship between the mortality rates of males and females is examined at various ages for the six countries above mentioned.

4. The more recent mortality statistics are analysed according to cause of death in broad groups.

5. The paper concludes with a statement on the points which seem to be of special interest, setting out in the form of questions some of the thoughts which spring from them.

In the pages which follow (Appendices 1-18) the statistics referred to in Parts 2 and 3 are illustrated by a series of graphs.
Preservation of Pension Rights
Authors: Spratling F. H. , Bacon F. W. , Bromfield A. E.
Published: July 2016

1. The Council of the Institute decided that “a Working Party be set up to advise the Council on the actuarial and other problems arising in connection with the transferability of pension rights ”. The Council of the Faculty accepted the Institute's invitation to be associated with the project and we were appointed to be the members of the Working Party.
Organisation of an Ordinary Life Office Using Punched Card Machines Including a Small-Scale Electronic Computer
Authors: Philip G. C.
Published: July 2016

Synopsis

The object of the paper is to examine the organisation of an average ordinary life office with a view to the introduction of a small-scale electronic computer operating from punched cards. For purposes of illustration and comparison a model office with 100,000 assurance policies in force operating under certain conditions has been assumed.

The general approach employed is:

(a) To examine the office system in current use,

(b) To consider what improvements may be made in the present system using normal punched card equipment where suitable, and,

(c) To discuss what further re-organisation would be required to make use of a computer and what advantages might be expected.

The paper is divided into three parts. Part I contains some brief remarks on North American experience and systems suggested for use there. In Part II, methods of maintaining policy records and the possibility of consolidation are discussed. Part III deals with the various services required from policy records, such as valuation and premium collection, and explores the practicability of using a consolidated policy record.

In the concluding remarks an attempt is made to assess the economics of using a small computer.

Included in the appendices is a brief description of a small-scale computer together with specimen card forms and a programme for carrying out a valuation.
Selection of Risks: American Viewpoint and Practice
Authors: Webster Andrew C.
Published: July 2016

Synopsis

This Paper outlines the underwriting practice of the life insurance companies in Canada and the United States where, because of the importance of mortality results in the successful operation of a life insurance company, underwriting is considered to be a major executive function.

There is a discussion of general underwriting considerations and a more particular discussion of general underwriting practice. This covers the use of an Underwriting Manual, the Numerical Rating System, the use of additional information such as statements from attending physicians, special tests, etc., the question of non-medical insurance and the methods of setting up substandard classes.

Mortality investigations of various kinds are considered from the Underwriter's viewpoint which is to test the results of underwriting both in general and on particular impairments. There is a discussion of some current problems such as insuring female lives, insuring hypertensives, and the use of experimental underwriting.

The final discussion is on the importance of establishing an underwriting goal for the life insurance company, a goal which should be made clear to the agency force. It also stresses the importance of a good agency force in achieving the desired results.
Automation of Data-Processing in Life Insurance
Authors: Engelfriet J.
Published: July 2016

Synopsis

1. The E.D.P. system which has been developed in the author's company a few years ago was based on the use of a small wired computer with a storage capacity of 30 words of 12 decimals each for data to be processed and (intermediary) results and with a practically unlimited capacity as regards the length of a programme because of the possibility of cardprogramming (48 instructions on each card). The system which in the meantime has been fully realised includes : manually punching of all data given in an application form for a new policy or in a similar internally prepared document with regard to an alteration, conversion or exit of an existing policy and automatically (a) producing of (new) policy record punched cards serving for printing a policy (if necessary) and to be filed for future use, (b) producing of punched cards for renewals, (c) idem for payment of agency commission and (d) of cards containing constants for valuation purposes, (e) updating valuation totals and totals of the accounts for surplus analysis as well as statistical totals. All data in the cards i.e. agency commission, Altenburger constants to be calculated from first principles.

2. Since a computer is available with much higher capacity (operation speed ± 64 microsec. for short operations, 500 microsec. for multiplication and division, storage capacity for data and programmes up to more than 30,000 words of 27 bits each, possibility of connecting the computer with a group of punched card machines and with a high speed photoprinter, if needed magnetic tape equipment) a new system has been developed which is based on the following assumptions :

(a) it is possible not only to do all calculations by aid of an electronic computer, but also the part of the daily work, which consists of the interpretation (in daily case work as it is centralised at the head office of the author's company) of the rules contained in a policy and its clauses ;

(b) it is possible to store information contained in or connected with a policy (including historical data) with the aid of a compact coding system on about two and a half punched cards ;

(c) it is possible to use the cards mentioned under (b) for monthly renewals, because of the given speed of the connected reading unit. This leads to the following general structure of data-processing :

(a) interpreting of the content of incoming letters and copying with the aid of a typewriter-tape punch this content on a form in a code adapted to the automatic data handling of the computer, producing simultaneously punched tape, (b) selecting the punched cards of the policy involved from the only existing consolidated file, (c) data-processing in the computer and producing automatically all documents needed.

3. The system of compact coding has been based on the possibility in the computer to interpret any combination of binary units. Since in this type of storing information data have no fixed localisation the normal programming system where operands are supposed to be found in a known address has to be adapted.
An Investigation Into the Mortality of Impaired Lives
Authors: Clarke R. D.
Published: July 2016

Synopsis

The paper describes an investigation which is being conducted by a life office into the mortality experienced by certain classes of impaired lives. The investigation was initiated in 1947 and the results for the period 1947-1958 are compared with a control experience of first-class lives.

It is emphasised that owing to the limited amount of data, and also to a certain lack of strict comparability in the control experience, the results must be regarded with some caution. The purpose of the paper is, in fact, not so much to communicate statistical information as to describe the methods followed in planning the investigation and to promote a discussion of the feasibility of setting up an investigation under the auspices of the Joint Mortality Investigation Committee to which all life offices operating in Great Britain would be invited to contribute data.

The paper presents a coding system for the impairments covered and discusses briefly the results so far obtained within the main groups. For some of the larger groups it has been possible to include a summary analysis by cause of death.
Reports by Study Groups on Electronics
Authors: Ross A. F.
Published: July 2016

The following Reports by the Study Groups on Electronics are the product of an experiment begun by the Faculty in 1959. During the discussion on the Paper by Gwilt and Philip (Application of Computers to Group Schemes) given to the Faculty in that year, the opinion was expressed that the Faculty should do something to enable those Fellows who were interested, to acquire a knowledge of the working and the uses of electronic computers. Following the suggestion, a meeting was called to which a few of the younger Fellows who were known to be interested in the subject were invited. A circular was subsequently issued to all offices, and to individual actuaries, advising them that the Faculty had decided to form Study Groups on Electronics, and asking the offices to supply names of any Fellows of the Faculty or Institute who would be interested in taking part in the project.
The Development and Incidence of United Kingdom Taxation in Relation to Mutual Life Assurance
Authors: Lundie W.
Published: July 2016

Synopsis

The paper attempts to show how the present basis of assessment to income tax of mutual life assurance companies has developed by modifying the general taxation system of the United Kingdom to fit special features of life assurance.

Section 1 of the paper deals with those aspects of the general tax laws which are relevant to life assurance companies and analyses the position which would arise in the absence of specialised legislation applicable only to life assurance.

Section 2 describes the evolution of specialised provisions affecting the taxation of life assurance and the present position is analysed in Section 3. Section 4 contains some suggestions for future legislation to remove anomalies in the present) basis.
Surplus: Two Hundred Years of Actuarial Advance
Authors: Cox P. R. , Storr-Best R. H.
Published: July 2016

Synopsis

The paper is in the nature of a summary of the authors' book “Surplus in British Life Assurance—Actuarial Control over its Emergence and Distribution during 200 Years”. Copies may be purchased direct from the Institute of Actuaries (price 17s. 6d.). Members and Students of the Faculty may obtain a copy for personal use at the reduced price of 11s. post free. It begins with a survey of the principal factors that have influenced the development of theory and practice in regard to surplus throughout the years. It describes the manner in which surplus first arose in scientific life assurance, and traces how this and other historical developments have had an important effect both in the early days and later as a valid standard of equity was gradually evolved. At the same time the influence of long-dated contracts and of the expectations of the public has been a stabilising factor in spite of rapid changes in the economic and social scene.

The characteristics of the nineteenth-century image of equity are described, and the history of the twentieth century in regard to surplus is seen as one of attempts to preserve that image through sharp and contrasting vicissitudes. This idea is explored in some detail for both ordinary and industrial life business.

The problems of the present day are reviewed one by one and the paper touches on such matters as economic inflation, the public demand for pension schemes, the introduction of computers and data-processing devices and the prospect of Britain joining the Common Market. Against this background, various modern concepts of equity are contrasted and brief reference is made to matching, immunisation and gearing. Equity in with-profit pension schemes and systems of variable policies are also considered.

This general survey leads the authors in the end to ask some critical questions about the performance of the profession throughout its history. These questions relate to the success or otherwise of actuaries in foreseeing the future, in attaining equity and in progressing with the times. The authors attempt to answer them and are able to end on a cheerful note as regards past achievements and to express great hopes for the future, which may well bring a new era for the profession.
The Shortage of Mathematicians and Mathematics Teachers
Authors: Holden Basil M.
Published: July 2016

May I first say how eager I was to accept this invitation ? Secondly I should like to say that I followed my father into this trade and, in those days—the 1930's—there were, to my knowledge, only three roads open to mathematicians. When I discussed this matter with my father he said, “You could go into the Civil Service, but you will find it very difficult because you have to write what you say and you say far too much.” “The second thing you can do,” he said, “is to be an actuary, but you will have to be good.” I am very happy to be a schoolmaster. I may say at this stage that I think there is a terrible waste in this room. Looking round, I see enormous headmaster possibilities in you all. You have the tremendously exciting look !
Valuation for Surplus
Authors: Springbett T. M.
Published: July 2016

Synopsis

The paper is largely concerned with discussing what is a suitable valuation basis for deciding the rate of bonus an office should declare if it wishes to maintain this rate of bonus in the future as long as conditions remain reasonably stable.

Because of recent developments, such as the substantial proportion of the assets now held in ordinary shares, the reverse yield gap, the present historically high rate of interest and the growth of immediate annuity and other single premium business, a net premium valuation in conjunction with assets at balance sheet values gives an inadequate view of the position of an office. With the advent of electronic computers a more realistic and comprehensive view is now possible, and the paper advocates a valuation of the liabilities on a modified bonus reserve basis with rates of interest and bonus the same as those implicit in the current premium rates, and a valuation of the assets at a notional rate of interest equal to the rate used in the valuation of the liabilities. The various problems arising in the valuation of assets, and especially of ordinary shares, at a notional rate of interest are discussed, and also the adjustments necessary if the assets and liabilities are not fully matched.

The final decision on the rate of bonus to be declared must in the end be a matter of judgment, as it depends on many factors which cannot be accurately forecast, such as the future course of the rate of interest, the amount of new business and the rates of premium charged. Nevertheless, it is now possible to make this decision in the light of a very much fuller analysis of the position than has probably been made in the past.
Apportionment of Trust Funds By Mutual Consent
Authors: Donald D. W. A.
Published: July 2016

Synopsis

The paper records the growth in the number of apportionments of trust funds due to the passing of the “Trusts (Scotland) Act 1961”. It considers the problems, as they arise in Scotland, of allowing for the impact of taxation, both in determining the interests to be valued and in fixing the valuation rate of interest, and it is suggested that the same net rate of interest need not necessarily be appropriate for all the beneficiaries.

Numerical examples are given of the effects on funds of varying size and investment content of various valuation assumptions, and the problem of disposing of the potential savings in taxation is discussed. The paper ends with a general section covering some practical points in the preparation of schemes to vary trust purposes.