Modelling of Policyholder Behaviour for Life Assurance and Annuity Products

Submitted on 19th April 2021

Research Overview With the pace of product innovation the life insurance and annuity industry has seen over the past two decades and the corresponding increase in the complexity of financial products, the list of actuarial assumptions that can materially impact product profitability has grown and includes a group of assumptions that are collectively referred to as “policyholder behaviour assumptions” (or “customer behaviour assumptions”). In an actuarial context, the term policyholder behaviour refers to any assumption for which experience is directly driven by the decisions policyholders make regarding the exercise of benefits and guarantees within their contracts.

Given the recent increased focus on these assumptions, this report first seeks to inventory what information is required from an experience analysis process, including the range of possible data sources and methods of experience data collection, analysis, and modelling available to actuaries. 

Society of Actuaries
Length of Resource
92 pages
Society of Actuaries
Date Published
Publication Type
Resource Type