bluuebunny/crossref_metadata_2025 huggingface dataset:
On an Investigation to show the Rates of Mortality and Marriage among Daughters of Peers and of Heirs-Apparent; with values of certain Benefits depending on Marriage and Death
Authors: Lees M. Mackenzie
Published: July 2016

Every one who has had to deal with the valuation of life interests, reversions, and entails, or with investigations involving Marriage Rates, must have been impressed with the carefully compiled and very complete tables which have been furnished by Dr. Sprague, dealing with the combined probabilities of marriage and mortality. These relate entirely to the marriage and mortality probabilities of bachelors and widowers of the Peerage ; and, so far as I am aware, no similar tables have been published relating to females. I find that in the discussion on Dr. Sprague's paper of 1879 (J.I.A., xxi, 448), Mr. C. J. Bunyon stated that about fifteen or sixteen years previously he had formed a table precisely similar to Dr. Sprague's, showing the probabilities of death and marriage among 10,000 unmarried people, up to the age of 60; only his table was not a table of bachelors, but of spinsters.
Life Assurance without Medical Examination
Authors: Nicoll John
Published: July 2016

Within quite recent years many schemes of life assurance without medical examination have been brought before the public by different offices, and have on the whole been very well received. No apology, therefore, seems necessary in submitting this paper to a meeting of the Faculty of Actuaries, more especially as, so far as we are aware, the matter has not previously been dealt with by any one.

It would be a mistake to look upon our subject merely as one out of many innovations in assurance practice of late years. As every one knows, it belongs to the earliest times of life assurance, though it is only during the last few years that it has again been introduced into the sphere of practical business. While that is so, it must be admitted that the circumstances and conditions under which it existed formerly are very, or even altogether, different from those which have seemed to warrant or necessitate its resuscitation at the present day. To make this as clear as possible, it may be well, in the first place, to trace shortly, as far as it can be done, the origin and history of the medical examination of proposers for life assurance.
The Investments of Australasian Life Offices
Authors: Gillison John Brotch
Published: July 2016

As many of you are aware, I received my early training in this city. Well do I remember the meetings of the Actuarial Society and the growing interest I took in its proceedings; but in which on account of my inexperience I was seldom able to take part. After an absence of nearly twenty years in Australia, where I read with interest and undoubtedly profited by the papers published by the Society from time to time, it seemed fitting, when I had the honour to be asked to contribute to your proceedings on my return to this country, that I should choose a subject distinctively Australian, in the hope that my fellow-members might in return profit in some degree by my experience on the other side of the world. The fact that several Scottish offices had lent large sums on mortgage in Australia led me to choose “Investments” as my subject. The addresses of Mr. A. H. Turnbull, Mr. David Paulin, and others, to the Actuarial Society and elsewhere, render it unnecessary for me to enlarge upon the principles and practices of British life offices in this respect, although I propose to make use of figures previously submitted, for purposes of comparison.
Office Premiums
Authors: Moir Henry
Published: July 2016

In submitting a revised edition of the paper which I read before the Actuarial Society of Edinburgh more than six years ago, I wish to express the pleasure I feel that this, my first effort, should not only have proved of benefit to students, but that the Faculty of Actuaries consider it worthy of a place in their Transactions. The subject was taken up originally to condense the best actuarial opinions and bring together some of those practical questions which had been dealt with by actuaries of ripe experience. Premiums can be profitably discussed at almost any time, because an exchange of views is sure to shed light on some obscure point of more or less importance. The present time is peculiarly opportune for further discussion, because of the recent publication of the New Mortality Experience, and the knowledge of such statistics which we have all been gradually absorbing.
Widows' Funds: the Valuation of a Widow's Annuity
Authors: Marr Vyvyan
Published: July 2016

The Liabilities of a Widows' Fund in respect of Annuities to Widows of members may, for the purpose of actuarial valuation, be divided into two classes:—First, the liability relating to annuities which are actually payable to the widows of former members; and Second, that for annuities which may become payable on the deaths of existing members.
Paid-up Policies and Surrender Value
Authors: Sprague Alfred Ernest
Published: July 2016

The principles upon which surrender values should be calculated are discussed at length in papers by Mr. Macfadyen (J. I. A., xvii, 381); Mr. Crisford (J. I. A., xxi, 301); and Mr. Fulford (J. I. A., xxxv, 199), but none of the methods proposed appear entirely satisfactory in practice, and I have therefore attempted to devise a scheme which shall not only give results in reasonable accordance with strict theory, but also prove simple and easily worked in its practical application.
Principles of Book-keeping for Insurance Students
Authors: Murrie Robert
Published: July 2016

Although Book-keeping has been for many years one of the subjects of examination prescribed for students of the Faculty, it is an open secret that it has been somewhat neglected by them. One reason for this is that the elementary text-books are rather discouraging, with their continual references to hogsheads of wine and bales of cloth; and another is that the writings on Insurance Book-keeping proper assume a certain amount of knowledge which, I fear, the average student does not possess.

In the notes which follow I have endeavoured to begin at the beginning, and to impart as much information as will enable the student to understand the books of an office and the entries made in them. I have made no attempt to teach the art of Bookkeeping or to describe the numerous auxiliary books in use. The forms of these vary very much in different offices and have been fully treated of elsewhere.

My paper divides itself roughly into three parts. The first is rudimentary; the second describes the principal books in use, dwelling specially on those which are common to all offices; and in the third I have given specimens and explanations of such entries in the books as a beginner is apt to find difficulty in understanding.
Aviation Risks in Relation to Life Assurance
Authors: Richardson Chas. F. B.
Published: July 2016

Synopsis

The paper commences with a résumé, with statistics, of the development and extent of aviation in its various branches up to the present time. It goes on to analyse the risk incurred in each, and to discuss principles of assessment of the risk and methods of calculating extra premiums. The duties involved in the various classes of employment connected with aviation are considered, and statistics submitted dealing with accidents and casualties attending commercial aviation in Britain and in the United States. Government supervision and the regulations in force regarding the issuing of certificates of airworthiness and licences to pilots, navigators, and ground engineers are outlined. Royal Air Force flying in its different branches is dealt with and statistics of casualties are given. The answers given to a questionnaire addressed to 60 offices transacting business in Great Britain together with the extras charged for different types of risk are analysed. The question of ordinary life assurance offices reassuring aviation risks with a company specialising in such insurance is discussed. The lack of statistics is commented upon, and stress is laid on the desirability of obtaining as soon as possible reliable statistical bases for the calculation of premiums to meet the demand for cover against aviation risks, a demand which in the nature of things will increase rapidly and must be met. In an Appendix are given the recommendations of the Actuaries' Club of Toronto and a supplementary proposal form in use by a Canadian office for cases where an aviation risk is involved.
Trusts in Scotland – a Few Points
Authors: Robertson F. W.
Published: July 2016

This paper deals with various points that may arise in practice, and in preparing it I have used such legal opinions as I have been able to refer to. A list of the books made use of in writing the paper is appended, to enable those interested to pursue the matter further.
The Gold Standard and Modern Conditions
Authors: Craig William Gilbert
Published: July 2016

Synopsis

The standard on which the currency of this country is based is of
importance to actuaries on account of (a) its bearing on the future real value of the currency in which life assurance contracts are made, and (b) its influence on the relative values of various currencies as affecting investment policy.

The advantages of the gold standard and the assumptions underlying it are examined, and it is shown how the validity of these assumptions has been undermined by the gradual development of various factors. It is suggested that there is little ground for anticipating that the presence of these disturbing factors will be temporary.

The present monetary position and the greatly changed position as regards the world's gold supplies both in amount and value are discussed and the case for the readoption of the gold standard is outlined. Two types of modified gold standard, (a) a partial gold standard, and (b) a managed gold standard, are considered.

The difficulties of a managed standard and the limitations of a common standard are reviewed and several conclusions reached.
New Methods of Approximate Valuation
Authors: Hellig Samuel Robert
Published: July 2016

Synopsis

The Paper shows :–

(a) That if valuations are made using assurance factors taken to two places of decimals only, it is possible by means of a simple modification to bring out results varying inappreciably from those obtained by the standard methods and that such valuations can be made entirely by summation.

(b) That the process, which enables multiplications to be dispensed with, can be extended so as to be applicable to valuations by factors taken to three places of decimals.

It is also shown that a relation found to exist between net premiums at different rates of interest can be employed, in conjunction with either of the foregoing methods, to estimate the effect of changes in the valuation rate of interest.
Temporary Assurance Mortality, 1924–34
Authors: Bowie W. K.
Published: July 2016

Synopsis

The Paper deals with the mortality experience of lives assured under Temporary Assurances with British Offices and refers briefly to previous investigations.

Particulars for approximately 30,000 policies were obtained and mechanical methods of sorting and tabulating were used.

Tables are given comparing the actual deaths with those expected by the A 1924–29 table for Temporary, Decreasing Temporary, and Convertible Term Policies, each subdivided into “medical” and “nonmedical.”
Life Office Investments in a Planned Economy
Authors: Whyte Lewis G.
Published: July 2016

Synopsis

An examination is made of the more important events in past years, with the object of assessing their consequences on the structure of Life Office investments. Reference is made to certain monetary and trade developments during the period 1919-39. Some aspects of the world depression of 1929-32 are examined. Special attention is paid to the period following the suspension of the gold standard, when Treasury control of interest rates was initiated and developed.

Investment problems which arose during the 1939-45 war are then considered. This is followed by an analysis of the factors influencing (1) the yield on British Government securities, and (2) the outlook for British trade. Lastly, the probable effect on the investments of Life Offices of the nationalisation programme is discussed.
Scottish Bankers' Mortality and Marriage Experience, 1923–1943
Authors: Borthwick W. B. , Denholm J. M. , Wallace J. G. , Waugh G.
Published: July 2016

Synopsis

The results of an investigation into the Mortality and Marriage Experience of the five Scottish Banks whose head offices are in Edinburgh during the period of 1923-1943 are presented. The general lines of the investigation follow those adopted by Mr. Fraser in his similar investigation for the period 1903-1923.

The rates of mortality and marriage have been taken out separately for bachelors and widowers, and rates of mortality separately for married men, wives and widows. The relative ages of husband and wife at marriage have also been examined. Comparisons are made between the rates of mortality and marriage shown in the period 1923-1943 with those given by Mr. Fraser for the period 1903-1923. To ascertain the financial effects of the new rates of mortality and marriage, monetary functions required in the valuation of widows' funds by the reversionary method of valuation have been calculated at 3% interest. These monetary functions have been compared with the equivalent functions deduced by Mr. Fraser for the 1903-1923 period. Finally, a valuation of one of the widows' funds concerned has been made at 3% interest, using Mr. Fraser's tables and also the tables based on the 1923-1943 experience.
The Investigation of Extra Mortality
Authors: Springbett T. M.
Published: July 2016

Synopsis

By the use of the number of deaths in the Continuous Mortality Investigation and the number of impaired lives in a small sample of recently issued policies an estimate is made of the extent of the data likely to be available from the records of the life offices for an investigation into extra mortality. It is estimated that for several impairments the ratio of actual to expected deaths for all ages and durations combined could be obtained with a standard error of 10% or less, but only the broadest conclusions could be drawn as to the distribution of the extra mortality according to age and duration.

The experience of normal lives obtained by a control investigation by individual cards is suggested as a standard, two policies on normal lives being included for each policy in the special investigation. The possibility is considered of using the data of the control investigation to throw fresh light on some of the mortality problems which cannot be solved by use of the data as at present returned to the Continuous Mortality Investigation.

A brief outline is given of the form an investigation should take and it is suggested that it should also include the investigation of the mortality of certain other special classes including female lives and lives assured for large sums.
Widows' Funds: Some Notes on Theory and Practice
Authors: Scrimgeour D. A. B.
Published: July 2016

Synopsis

The Paper deals with some of the problems which arise in the valuation of Widows' Funds with special reference to the Widows' Funds of certain professional bodies in Scotland.

An analysis is made of data derived from the Scottish Bankers' Marriage and Mortality Experience 1923–1943 (T.F.A., 19, p. 149) with a view to determining the applicability of the Collective Method to a valuation of the “existing” at the close of that Experience.

The various factors entering into a Widows' Fund valuation are examined in relation to a particular Fund and the importance of the valuation rate of interest illustrated.

The Paper concludes with a discussion of the “reserve for loss on future entrants” often met with in the valuations of such Funds, and of the arguments for and against proposals which have been made for its elimination.
The Mortality Experience of the Gotha Life Office, 1829–1896: An Account of the Investigation and of its Results
Authors: Richmond George William
Published: July 2016

During the past few years there have been published abroad the results of several important mortality investigations, to which comparatively little attention appears to have been directed here.

Of the investigations in question, the first place may be well assigned to that of the Gotha Life Office. It was the earliest published of them; is very complete, and some of the problems investigated therein are either new or have not hitherto been worked out so fully.
On Policies with Deferred Participation in Profits, and Policies with Contingent Bonuses
Authors: King George
Published: July 2016

I esteem it a great privilege to have been invited to read a paper before the Faculty of Actuaries in Scotland. It is many years since the distinguished honour of being elected a Fellow of the Faculty was conferred upon me, and I am afraid that I have not done directly very much to show my gratitude. The Faculty, however, is always indulgent, and will overlook every shortcoming.
On a Method of Calculating the Present Values of Prospective Pensions Based on Salary, and the Expected Amounts of the Future Pension Payments
Authors: M'Lauchlan James John
Published: July 2016

The method of calculating the values of prospective pensions which I am about to describe differs in some respects from those given in the standard papers on the subject, and will be found, I think, to possess advantages of its own. I shall deal with its application to the case of pensions based on salaries, when the amount of the pension is a uniform percentage of salary for each year of service taken account of.

I have followed Mr. Manly in the use of the following symbols (see his paper of 1901—J.I.A. xxxvi, 209), namely, lx to denote the number living and remaining on the active list at age x as given in the Service Table, and Dx and Nx to correspond; rx to denote the number retiring from failure of health between ages x and x + 1, sx to denote the salary receivable between ages x and x + 1, and Dsx to denote Dx X sx. When however lx, Dx, Nx, or Dsx have a circumflex accent, these symbols have the ordinary meanings, and the functions are based respectively on the Pensioners Mortality Table. I have found it necessary to employ also a certain number of new symbols which are described in the Key to the Special Notation (see pp. 31, 32). I have also followed Mr. Manly in the assumptions made in the paper mentioned above, that the retirements or superannuations applicable to any year of age take place at the end of the year, and that the pension commences at the same time and is payable yearly thereafter.
The Agents' Ledger—can it be Dispensed with?
Authors: Murrie Robert
Published: July 2016

In the discussion which followed the reading of my paper “Principles of Book-keeping for Insurance Students” (T.F.A. iv. 21), some remarks were made by Mr. M'Lauchlan about the Agents' Ledger, suggesting the possibility of doing without it. In the following paper I have attempted to show how this can be done, though I have gone on somewhat different lines from those he had in view at the time. Since this paper was written I have ascertained that some offices have dispensed with the Agents' Ledger, either altogether or to a large extent.
The Amortisation of Bonds and the Valuation of Assets of a Life Insurance Company
Authors: Moir Henry
Published: July 2016

The word “amortisation” is now being used in insurance circles in America to represent the operation of a sinking fund, whereby bonds or other fixed term securities, bought at a premium or at a discount, will be brought down, or up, to the par value at the date when repayment is promised. The scientific basis of the method is so well known to actuaries and is so fully explained in such standard works as King's Theory of Finance and the Institute of Actuaries Text-Book, that there is no need for me to enter upon a discussion of the principles. But of late years the system has assumed great practical importance, and the general method, with the suitability of its application to our business, are subjects worthy of consideration and discussion.
On the Construction of Salary Scales for Use in the Valuation of Pension Funds, and the Valuation of Prospective Pensions Based on Accumulated Contributions
Authors: M'Lauchlan James John
Published: July 2016

When it is desired, in the case of a Pension Fund granting pensions based on salary, to calculate the value of the prospective pensions, it is necessary to frame a scale of average salaries at successive ages, so as to give the means of estimating what salaries the present contributing members of the Fund will on the average be receiving up to the time of retirement. The scale is also necessary for the purpose of calculating the values of future contributions and returns of contributions.
On Some Disputed Questions of Probability
Authors: Whittaker E. T. , Lidstone G. J.
Published: July 2016

The Mathematical Theory of Probability has, as is well known, two main branches:

1°. Direct or Deductive Probability, in which the behaviour of a system is deduced from a knowledge of its constitution.

Thus the problem “What is the probability of throwing a double-six in a single cast of two dice” belongs to deductive probability, since we know the constitution of the dice–that they are symmetrical six-sided bodies–and from this knowledge we deduce the probability of a double-six.

And 2°. Inverse or Inductive Probability, in which the constitution of a system is inferred from its observed behaviour.

As an example of Inductive Probability, suppose we visit a rifle-range and find a man firing at the target. At first we know nothing regarding his skill as a marksman ; but after watching a few shots we are able to form a rough estimate of it, and this estimate becomes more sharply defined and more confident the longer we observe his performance , so that ultimately we attain to a trustworthy knowledge of his “constitution” as a marksman, i.e. we can assign the probability that his next shot will hit or miss.
General Annuity Fund Premium Rates
Authors: Scott W. A. B.
Published: July 2016

Synopsis

The taxation treatment of the general annuity fund gives rise to additional variables in the calculation of premium rates. The paper discusses premium rates with particular reference to the impact of the tax structure and an attempt is made to determine a basis appropriate to a mutual life office. Some specimen rates applicable to recent conditions are then calculated and compared with market terms at the time of writing.
Income Tax as Affecting Life Assurance Offices
Authors: Barnett John
Published: July 2016

In submitting these remarks on Income Tax I need hardly say that they do not form an exhaustive article on the subject. The paper is intended rather to show in a general way the practical effect of the Income Tax law as regards Life Assurance Offices. The method of dealing with the subject would appear, perhaps, to be following the line of least resistance; but, as the more recent Income Tax legislation, so far as regards the assessment of such Institutions, is hardly yet out of its infancy, I think the purpose of the paper will be best served if it is confined to a review of the recent changes in the law and of the law as it at present stands.
Currency and Foreign Exchange: a Survey of Modern Conditions
Authors: Douglas Charles M.
Published: July 2016

The following paper is intended to form a link between the elementary text-books, which for the most part deal with stable monetary conditions, and the voluminous output of modern writings on the financial situation of the present day. The immediate objects of the paper are to collect very briefly the opinions of experts as to the practical forces which now operate on foreign exchange, to differentiate between points on which they agree and points on which they differ, and to explain where necessary the technical language used.
Harry H. Macbean, W.S., Memorial Fund
Authors: Walton W. G. , Notman James H.
Published: July 2016

The following letter has been received from the Clerk to the Society of Writers to the Signet, and is published for the information of members of the Faculty. The copy Trust Deed and Schedule of Application referred to in the letter are in the hands of the Hon. Secretary, and are available for inspection
Valuation of Group Pension Schemes
Authors: Philip G. C. , Robson W. I. S.
Published: July 2016

Synopsis

In the first part of the paper the general nature of the problem is dealt with in relation to the movements which take place in group pension schemes and the information which is readily available from the normal office records. The choice of valuation date is discussed and some of the differences which exist between private funds and office schemes and which lead to essentially different treatment are noted.

The valuation of schemes providing future service pension by the single and annual premium methods is discussed separately, each being developed from a consideration of the simplest form of contract to the more elaborate forms, and approached from the standpoint of the net premium and gross premium methods of valuation. Under each heading theoretical formulas are given and these are considered from the practical standpoint of designing accurate valuation methods and of devising, without appreciable loss of accuracy, approximate methods which reduce considerably the arithmetical work. Throughout, the effort is made to reduce the data to be recorded to a minimum and to use, wherever possible, the data which an office will require for its costing purposes.

The paper includes a section on past service pension in which is given a theoretical review of the various methods commonly used to provide pensions.

In the appendices it is demonstrated how Trachtenberg's formula may be adapted for valuation of a single premium scheme by the net premium approach and an example is given of the working of the suggested short method in the valuation of an actual scheme together with a valuation “in extenso” for comparison of the results obtained.
The Financial Structure of a Life Office
Authors: Haynes A. T. , Kirton R. J.
Published: July 2016

Synopsis

The authors' purpose in this paper is to analyse the financial structure of a life office and, in particular, the relationship between the assets and liabilities of a life assurance fund. This analysis is based upon the principle that the guarantees of future capital security and of long-term interest yield involved in the contracts issued by a life office should be backed either by “matched assets” providing equivalent guarantees of capital and interest or by sufficient free reserves to cover the possible adverse effects of departure from the “matched assets” position.

In Parts I and II of the paper, the principle of “matched assets” is studied in relation to three model offices representing stationary and increasing funds operating under idealised conditions. For each model office the “standard” date-distribution of assets is determined–the distribution which, so far as possible, will insulate the fund from the effects of fluctuations in the market rate of interest upon existing assets and liabilities. The profit or loss resulting from “going long” or “going short”, as compared with the standard asset distribution, is then investigated against the background of a rise or a fall in the general level of interest rates.
Industrial Assurance Today
Authors: Britt Kenneth J.
Published: July 2016

Synopsis

The paper attempts to give a factual description of industrial assurance as it is today. Among the matters discussed are :–

Definition, origin and development of the business

Legislation affecting it

Statistics

Expenses

Changes in the type of business transacted in recent years

The organization of a large industrial assurance office

New business, policy conditions, and the calculation of benefits

Methods, bases and machinery used in the valuation of policy contracts

Profit sharing and its evolution

Free policies and cash surrender values

Lapse rates

Protection from forfeiture during periods of emergency

Criticisms

Positive achievements of industrial assurance and its future
British Government Securities
Authors: Marshall J. B.
Published: July 2016

It must be said at the outset that it is no part of the purpose of this paper to outline a method by which general movements of the gilt-edged market may be forecast. The reason for this is simple, as it requires no great exercise of modesty to disclaim qualification for such a task. The paper's purpose is, rather, to analyse the group's characteristics, to study the components of an individual security, and finally to suggest a policy whereby a life office can obtain a reasonable return on its gilt-edged portfolio.
Experiments in Connexion with Returnable Premiums in Group Pension Schemes
Authors: Young John
Published: July 2016

In contributory group pension schemes it has become customary to arrange for the employee's premiums to be returned, without interest, on the death of the employee, or on his withdrawal before reaching his pension date. It will be agreed that this is of secondary importance in the composition of the scheme; nevertheless its presence does introduce complications to the conduct of the business which are possibly out of proportion to its significance. It is with this aspect that this paper is concerned; it represents an attempt to give the death return a simplified place in the administration of the business which is more in keeping with its importance. The complications mentioned arise from the strict adherence to formulas which make theoretically correct allowance for the death return. The simplifications in administration follow from a simple and natural approximation to the death return, and the extent and practical consequences of the approximation are examined in the paper.
The Fourteenth International Congress of Actuaries
Authors: J. G. W.
Published: July 2016

The capital city of Spain, Madrid, was the venue for the Fourteenth International Congress of Actuaries and intending participants of the Congress eagerly welcomed the opportunity not only of renewing friendships with actuarial colleagues but of visiting the colourful and historic city. There were some fears that the temperature might be uncomfortably high for those from northern lands but Madrid provided delightful weather all the time the Congress lasted.
A New Retirement System With Provision for Variable Income
Authors: Maclean J. B.
Published: July 2016

Synopsis

The paper describes a new type of deferred life annuity which has recently been introduced in the United States and which has been used, so far, principally in connection with the retirement plans of colleges and other educational institutions and, to some extent, in self-administered pension plans of commercial corporations. These annuities do not guarantee specific or equal money payments. The fund, which is divided into an “accumulation fund” and an “annuity fund”, is invested entirely in ordinary shares (“common stocks”). Premiums (contributions) and income from the fund are applied to purchase “accumulation units”, the value of a unit being determined monthly in accordance with stock market prices. At the retirement date of any individual the then current value of the units he owns is used to purchase a life annuity of a fixed number of “annuity units” in accordance with the then current value of a unit in the annuity fund. The successive cash payments to the annuitant are the current values of the fixed number of annuity units which he holds.

The purpose of this plan is to provide a variable cash income which will, to some extent, reflect the changes in the cost of living, i.e., to provide a more constant “real income” both in times of inflation and deflation.

The paper includes : (1) a short account of the origin and business of the company which has introduced this plan, and which is of a special character, with business limited to educational institutions and their employees ; (2) consideration of the circumstances which led to the adoption of the plan ; (3) a general explanation of the basis of the plan and of its mode of operation ; (4) some illustrations of the results which would have been obtained if this plan had been in operation in the past compared to the conventional type of deferred annuity with fixed payments, including consideration of the relative amounts of cash income realised, the relation of cash income to purchasing power and the extent of fluctuation in income under the “variable annuity” ; (5) reference to the possible use of such a plan by life insurance companies generally and of other means by which variable annuities of this type are being or may be provided.
On the Transaction of Life Assurance and Annuity Business Without Participation in Profits
Authors: Dow J. B.
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, traces the growth of without-profit business in the United Kingdom and the trend of the without-profit premiums during the period from 1913. The actuarial bases of the rates are examined and some conclusions reached regarding the profitability of the business.

The actuarial considerations which should influence an oflice in determining the volume and the type of new business to be transacted are then discussed for both mutual and proprietary companies, and methods are suggested to assist in determining what proportions of with-and without-profit business should be transacted. Tables are given illustrating the numerical applications of the methods to life assurance business in varying circumstances, and their application to annuity business is discussed.
Application of Computers to Group Schemes
Authors: Gwilt G. D. , Philip G. C.
Published: July 2016

Synopsis

In this Paper various methods of maintaining records and performing the annual costing and valuation of Group Life Assurance and Pension Schemes are discussed with particular reference to the “single premium” type of scheme.

In Part I a simple form of single premium scheme is defined and the problem to be solved is set out. Possible solutions are discussed involving handwritten cards, punched cards and electronic computers.

In Part II some of the added complications which arise in practice are introduced and a proposed system involving use of punched cards and a small-scale electronic computer is given in some detail.
Life Insurance in Canada—Some Aspects and Recent Developments
Authors: Westwater G. T. , Burns J. C.
Published: July 2016

Synopsis

The paper describes certain aspects of life insurance business in Canada under the following headings :—

(a) Legislation and regulation, both federal and provincial

(b) Taxation

(c) Investment of funds

(d) Agency system

(e) Ordinary life insurance, including a description of some current developments

(f) Group pension plans

(g) Group life insurance

(h) Actuarial and professional societies.

In dealing with the above subjects emphasis has been placed on matters where the Canadian practice may differ somewhat from the British.
The Effect of Taxation on Comparative Yields on Life Office Investments
Authors: Jamieson F. S.
Published: July 2016

Synopsis

The paper points out that, owing to the increasing complexities of U.K. tax legislation, it is no longer possible in the majority of cases to use unadjusted yields for comparative purposes in the selection or review of investments. The three main types of investment in respect of which yield adjustments to allow for the effect of taxation require to be made are considered, which are as follows :—

(1)

Redeemable investments.

(2)

Shares of U.K. companies which receive Double Taxation Relief because of their overseas interests.

(3)

Shares of foreign companies in respect of the dividends on which U.K. shareholders are entitled to claim Double Taxation Relief.

The taxation assumptions which require to be made for the calculation of correct comparative yields on the above types of investments are discussed and formulae are given which make allowance for the effect of these assumptions. Comparative tables are also given showing the yields brought out on differing tax assumptions and on two different basic methods of calculating redemption yields.

In the body of the paper the assumptions discussed and formulae given refer to a British life office or life fund doing business in the U.K. only; but in a short appendix mention is made of some further adjustments which may be required in the case of life offices which also do business abroad.
Ordinary Branch Life Premiums in Modern Conditions
Authors: Asbury C. J.
Published: July 2016

Synopsis

Recent developments affecting the bases of calculation of ordinary life assurance and annuity premiums include the publication of the A1949-52 and a(55) mortality tables, the passing of the Finance Act 1956 and the rise in interest yields on life assurance funds to unprecedented heights, resulting in high bonus rates.

Part I of the paper deals with the general effect of these and other developments on the three main variables of mortality, interest and expenses and in the charge to be made for the right to participate in surplus.

Part II deals with the detailed effect of these developments on the actual premium calculation formulae used for various standard types of policy and for types of policy that have come into existence or increased substantially in importance in recent years, including self-employed annuities, variations on the temporary assurance theme and policies effected for estate duty purposes such as pure endowments with return and whole life assurances for large amounts at high ages.
Interest Rates and Monetary Policy
Authors: Wadsworth J. E.
Published: July 2016

Two centuries ago, a distinguished son of Scotland made his “Inquiry into the Nature and Cause of the Wealth of Nations”, there bringing together important business interests of actuaries and economists, and so providing justification for addressing you this evening. “The only trades”, wrote Adam Smith, “which it seems possible for a joint stock company to carry on successfully, without an exclusive privilege, are those of which all operations are capable of being reduced to … a routine. … Of this kind is, first, the banking trade; secondly, the trade of insurance.” As we all know, actuaries are a mainstay of insurance undertakings and economists are to be found in the employ of the banks; both, that is, are engaged with companies that are closely involved in movements in the level of interest rates, an involvement where, despite the views of Scotland's revered father of economists, few operations can be “reduced to a routine”!
Estate Duty on Life Assurances and Annuities
Authors: Williamson H. A. A.
Published: July 2016

Synopsis

The paper is concerned mainly with the incidence of estate duty on life assurances and annuities under sub-sections 2 (1) (c) and 2 (1) (d) of the Finance Act 1894. The effect of changes in the law introduced by section 34 of the Finance Act 1959 are examined by reference to two trust policies effected under the Married Women's Property Acts, one a policy for the absolute benefit of the wife of the life assured and the other a policy also for the benefit of the wife but with the trust falling should she predecease her husband. Where the assessment falls under sub-section 2 (1) (c) the treatment of life policies now follows the same lines as gifts of other types of property and the requirements to obtain limitation or exemption from duty are considered in detail.

The paper goes on to review the incidence of estate duty on joint life and last survivor annuities according to the manner in which the contract is written.

Finally some examples are given of the effect on estate duty of dealings with policies by beneficiaries in terms of section 34 of the Finance Act 1959.
The Design, Application and Future Development of the F.T.-Actuaries Index
Authors: Haycocks H. W. , Plymen J.
Published: July 2016

Synopsis

Now that the original Actuaries Investment Index has been replaced by the F.T.-Actuaries 500 Share series, the Authors felt it appropriate to prepare a sequel to their earlier paper “Investment Policy and Index Numbers” submitted in 1956.

The first part of the paper deals with the selection of the constituents and of the groups for the Equity indexes, and with the methods of averaging and weighting that are used.

The new index with its wide coverage and its daily quotation represents a considerable advance over the earlier Actuaries and F.T. series and should be widely used for checking portfolio performance and for determining investment policy. Representing as it does the experience of a large and comprehensive sample of U.K. industry the index display should be of considerable application for long-term historical studies and for purposes of social research and national economic planning.

Suggestions are made for extending the index coverage so as to include items such as the asset value, the cash flow, the stock level and the capital expenditure as used for investment analysis.

In the final section entitled “Investment Analysis by Computor” the Authors draw attention to the value of the index statistics for investment analysis. These statistics might be used to build up data from which a form of investment analysis by computor could be developed.

Altogether the question of further development of the index coverage and of making proper use of the statistics is a most fruitful field for further research by members of the profession.
Economic Instability and Growth of Output
Authors: Wilson Thomas
Published: July 2016

Synopsis

Much concern has been expressed in recent years about the slow rate of growth of output in the U.K. as compared with the achievements of a number of other countries. One of the several explanations advanced is that Britain has suffered so much from instability—often referred to as “stop-go”. The first part of the paper sets out to test this proposition.

The statistics of gross domestic product, industrial production and fixed investment over the years 1950 to 1963 or 1964 are analysed for the U.K., the U.S.A., West Germany, France, Italy, Sweden, and Japan. The results show that the fastest rates of growth were achieved in countries where there were also violent fluctuations of output. Fast growth, but not the fastest, was also associated elsewhere with a high degree of stability. The evidence is thus too contradictory to support, on the face of it, either the view that stability is a necessary condition of fast growth or that instability is necessarily the price of growth.

The second part of the paper discusses some aspects of stabilization policy with particular reference to recent British experience.
A Comprehensive Data Processing System For a Life Office
Authors: Whitehead D.
Published: July 2016

Synopsis

The paper outlines a system for processing the data of a life office to make efficient use of men and of machines available at the present time. The conditions to be met by an electronic computer and the persons responsible for its operation (systems analysts, programmers and operators) are first considered. The mechanical and manual aspects of the system are then dealt with in turn. After an outline of the problems involved in the institution of the system, the financial and other benefits to be expected are estimated in the light of the experience so far gained. Finally, a brief look is taken at the way in which developments may proceed in the future.
A New Type of Summation Graduation Formulae related to Whittaker's Analytical Formula
Authors: Davidson Andrew R. , Reid A. R.
Published: July 2016

Synopsis of Paper

The basis of this Paper is the new method of graduation introduced by Professor E. T. Whittaker, and expressed in the equation

where δ indicates central differencing, so that δ6u′x=Δ6u′x−3;u′=the graduated and u the ungraduated values of a series of observations, and ∈ is a measure of the importance assigned in any particular case to adherence to the original data as against perfect smoothness in the graduated curve.

Certain terminal conditions attach to this equation, and it is suggested that if no attempt be made to carry the method to the extremes of the series of data, these terminal conditions may be disregarded.

By methods described in the Paper, different summation formulae of graduation are derived from the equation, giving ε various values. The results of test graduations of the a(f) and a(m) ultimate tables by certain of these formulae are shown, and compared with the results under the exact solutions obtained by Dr. A. C. Aitken. A graduation is also made of the Female Government Annuitants 1900-1920 Experience, and the results are compared with these produced by the methods suggested in Dr. Buchanan's recent paper (T.F.A., x., p. 289), and in the discussion thereon.

It is suggested that ε will prove of practical value as an aid to the selection and classification of graduation formulae, and that summation formulae obtained by the methods described have thus a practical advantage as well as one of theory.
The Theory of Selection: its History and Development
Authors: Buchanan James
Published: July 2016

Synopsis of Paper

The Paper is a review of the theory of selection as developed by British actuaries.

The fundamental ideas underlying the theory were present in the minds of actuaries from a very early date. Apparently the earliest allusion to the subject was that of Joshua Milne in his treatise on Annuities and Assurances; but its importance was clearly recognised by Arthur Morgan in his Introduction to the Experience of the Equitable Society, and by Thomas Galloway in the Preface to the Experience of the Amicable Society.
On Causes of Death in Britain (1970-72)
Authors: McCutcheon J. J.
Published: July 2016

The purpose of this paper is to analyse briefly the relative significance of the principal causes of death which currently prevail in the United Kingdom. The work is a sequel to that of references and, in which various life tables were produced from the data of the 1971 U.K. census and the numbers of deaths during the years 1970 to 1972. These earlier papers, however, study mortality without reference to the underlying causes of death.
A Mathematical Model for the Gilt-Edged Market
Authors: Clarkson R. S.
Published: July 2016

Synopsis

This paper investigates what general form of price model is required to represent a market that is in equilibrium under switching action and describes how a special case of this general price model can be applied to the gilt-edged market, with particular emphasis on long-dated stocks. Applications of the mathematical model are then developed in a form that could be used by a life office or pension fund for the management of a portfolio of long-dated British Government stocks. Finally, a comparison is made between conventional yield curve methods of analysis and methods based on this mathematical model.
Notes on the Financial Times-Actuaries British Government Securities Indices in 1977
Authors: Wilkie A. D.
Published: July 2016

1.1. The paper “The F.T.-Actuaries Fixed Interest Indices” by G. M. Dobbie and A. D. Wilkie (J.I.A., 105, 15 and T.F.A., 36, 20.3) gave details of the purpose and construction of the F.T.-Actuaries fixed interest indices, and the note “The F.T.-Actuaries British Government Securities Indices 1976” (J.I.A., 105, 27 and T.F.A., 36, 2.1.4) gave details of the constituents, changes and values of the B.G.S. indices in 1976. The present note continues the history for a further year.

1.2. In §8.2 of the paper it was observed that during 1977 the government had issued stocks where the issue price was payable in separate “calls” on a series of dates. The published indices, however, included these stocks only when they were fully paid. An alternative series of indices has also been constructed, allowing for the calls as and when they occurred. This note gives details for the alternative series, but refers also to the published series where the results differ.