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Actuarial Analysis of Single Life Status and Multiple Life Statuses
American Journal of Theoretical and Applied Statistics
Volume 5, Issue 3, May 2016, Pages: 123-131
Received: Apr. 12, 2016; Accepted: Apr. 22, 2016; Published: May 10, 2016
Authors
Abonongo John, Department of Mathematics, Kwame Nkrumah University of Science and Technology, Kumasi, Ghana
Luguterah Albert, Department of Statistics, University for Development Studies, Navrongo, Ghana
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Abstract
Actuaries frequently employ probability models to analyse situations involving uncertainty. They are also not simply interested in modelling the future states of a subject but also model cash flows associated with future states. This study compared single life status and multiple life statuses using life functions. The expected time until death, annuity payments, insurance payable and premiums were estimated using age as a risk factor. The analysis also employed the De Moirve’s law on mortality in estimating the rate of mortality. The analysis revealed that, the expected time until death for single life status and multiple life statuses are all increasing functions of age. It was realized also that, the premium for single life status was increasing with age and the same with multiple life statuses. But the premium for single life was higher than multiple life statuses. In the case of the multiple life statuses, it was revealed that, premium for joint life was higher than the last survivor and that a change in the interest rate or force of interest and the benefit did not changed the trend in premium payments.
Keywords
Single Life Status, Multiple Life Statuses, Annuity, Insurance and Premium
Abonongo John, Luguterah Albert, Actuarial Analysis of Single Life Status and Multiple Life Statuses, American Journal of Theoretical and Applied Statistics. Vol. 5, No. 3, 2016, pp. 123-131. doi: 10.11648/j.ajtas.20160503.17
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