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    Exam MLC Formulas

    Uploaded by

    night_98036
    The document provides an overview of key formulas used in life table analysis for probabilities, life expectancies, present values, and other metrics. It lists both discrete and continuous formulas for probabilities, survival functions, present values, annuities, and variances. The formulas are applicable to various situations including discrete, continuous, temporary, whole life, and those modified for monthly payments.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Exam MLC Formulas

    Uploaded by

    night_98036
    203 views6 pages
    The document provides an overview of key formulas used in life table analysis for probabilities, life expectancies, present values, and other metrics. It lists both discrete and continuous formulas for probabilities, survival functions, present values, annuities, and variances. The formulas are applicable to various situations including discrete, continuous, temporary, whole life, and those modified for monthly payments.

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    Summary exam MLC formulas

    Original Title

    Exam MLC formulas

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    The document provides an overview of key formulas used in life table analysis for probabilities, life expectancies, present values, and other metrics. It lists both discrete and continuous formulas for probabilities, survival functions, present values, annuities, and variances. The formulas are applicable to various situations including discrete, continuous, temporary, whole life, and those modified for monthly payments.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    203 views6 pages

    Exam MLC Formulas

    Uploaded by

    night_98036
    The document provides an overview of key formulas used in life table analysis for probabilities, life expectancies, present values, and other metrics. It lists both discrete and continuous formulas for probabilities, survival functions, present values, annuities, and variances. The formulas are applicable to various situations including discrete, continuous, temporary, whole life, and those modified for monthly payments.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 6

    1

    A Field Guide to Some formulas


    Crucial formulas:
    Probabilities:
    p
    x
    =
    1
    p
    x
    t
    p
    x
    = Pr[(x) lives to age x + t]
    = p
    x
    p
    x+1
    . . . p
    x+t
    =
    l
    x+t
    l
    x
    t
    q
    x
    = Pr[(x) dies between ages x and x + t]
    = 1
    t
    p
    x
    t|u
    q
    x
    = Pr[(x) dies between ages x + u and x + t + u]
    =
    u
    p
    x

    t+u
    p
    x
    =
    l
    x
    l
    x+t
    l
    x
    (|u defers any eect u years)
    t
    p
    x
    q
    x+t
    =
    l
    x+t
    l
    x+t+1
    l
    x
    =
    t
    p
    x

    t+1
    p
    x
    =
    1|u
    q
    x
    =
    |u
    q
    x
    =
    1
    d
    ln

    Sd + P e
    P e Id

    Pr(L
    g
    0
    0) =
    []
    p
    x
    , [ ] = greatest integer function
    2
    Discrete
    t
    E
    x
    =
    t
    p
    x

    t
    A
    1
    x:n|
    =
    n1

    t=0
    t
    p
    x
    q
    x+t

    t+1
    A
    1 (m)
    x:n|
    =
    mn1

    t=0
    t/m
    p
    x 1/m
    q
    x+t/m

    t/m+1
    A
    (m)
    x
    = A
    1 (m)
    x:|
    A
    x:n|
    = A
    1
    x:n|
    +
    n
    E
    x
    a
    x:n|
    =
    n1

    t=0
    t
    p
    x

    t
    a
    (m)
    x:n|
    =
    1
    m
    nm1

    t=0
    t/m
    p
    x

    t/m
    a
    x
    =

    t=0
    t
    p
    x

    t
    a
    x:n|
    =
    n

    t=1
    t
    p
    x

    t
    = a
    x:n|
    1 +
    n
    E
    x
    e
    x
    =

    k=1
    k
    p
    x
    E(K
    x
    ) = e
    x
    E(K
    2
    x
    ) = 2

    k=1
    k(
    k
    p
    x
    ) e
    x
    e
    x:n|
    =
    n

    t=1
    t
    p
    x
    = a
    x:n|
    with = 1 (i = 0)
    P =
    A
    x
    a
    x
    P
    (m)
    =
    A
    x
    a
    (m)
    x
    Note: This needs to be divided by m to give the mthly payment.
    L
    g
    0
    = (S +
    P e
    d
    )v
    kx+1
    + I
    P e
    d
    I = initial expense, e = recurring expense
    3
    Continuous:
    S(x) = S
    0
    (x)
    =
    x
    p
    0
    S
    x
    (t) =
    t
    p
    x
    =
    S(x + t)
    S(x)
    f
    x
    (t) =

    t
    l
    x+t
    l
    x
    =

    t
    S
    x
    (t)
    =
    t
    p
    x

    x+t
    A
    1
    x:n|
    =

    n
    0

    t
    t
    p
    x

    x+t
    dt
    =

    n
    0

    t
    f
    x
    (t) dt
    A
    x
    = A
    1
    x:|
    A
    x:n|
    = A
    1
    x:n|
    +
    n
    E
    x

    e
    x
    =


    0
    t
    p
    x
    dt
    E(T
    x
    ) =

    e
    x
    E(T
    2
    x
    ) = 2


    0
    t
    t
    p
    x
    dt
    a
    x:n|
    =

    n
    0
    t
    p
    x

    t
    dt
    a
    x
    = a
    x:|

    e
    x:n|
    = a
    x:n|
    with = 1 (i = 0)
    4
    De Moivre, also called uniform:
    l
    x
    = x
    A
    1
    x:n|
    =
    1 e
    n
    ( x)
    A
    x
    = A
    1
    x:x|
    A
    1
    x:n|
    =

    i
    A
    1
    x:n|
    Exponential, also called constant force of mortality
    S(x) = e
    x
    t
    p
    x
    = e
    t
    A
    1
    x:n|
    =

    +

    1 e
    (+)n

    A
    x
    =

    +
    a
    x:n|
    =
    1
    A
    1
    x:n|
    =
    1
    +

    1 e
    (+)n

    (1)
    5
    Below is a summary of some formulas and their range of validity,
    when suitably modied. In particular discrete formulas use d = i/(1+
    i) instead of = ln(1 + i). Things payable mthly (m) will use d
    (m)
    and i
    (m)
    instead of d and i. C means continuous, D means
    discrete, and WL means whole life.
    6
    Table 1: Life Table Formulas
    Formula Valid
    l
    x+t
    = (1 t)l
    x
    + tl
    x+1
    UDD, 0 t 1
    t
    q
    x
    = t(q
    x
    ) UDD, 0 t 1
    l
    x+t
    = (l
    x
    )
    (1t)
    (l
    x+1
    )
    t
    CFM, 0 t 1
    t
    p
    x
    = (p
    x
    )
    t
    CFM, 0 t 1

    x+t
    =
    qx
    1t(qx)
    UDD, 0 t 1
    a
    x:n|
    = a
    x

    n
    E
    x
    a
    x+n
    C,D,(m)
    a
    x:n|
    = a
    x

    n
    E
    x
    a
    x+n
    C,D,(m)
    A
    1
    x:n|
    = A
    x

    n
    E
    x
    A
    x+n
    T, C, D,
    A
    x
    = q
    x
    v + p
    x
    A
    x+1
    D,(m)
    A
    x
    + a
    x
    = 1 C,D,(m),T,
    A
    x
    =
    i

    A
    x
    UDD, De Moivre, WL, T,(m)
    A
    x
    = (1 + i)
    1
    2
    A
    x
    Claims Acceleration
    A
    (m)
    x
    = (1 + i)
    m1
    2m
    A
    x
    Claims Acceleration
    V ar(A
    x
    ) =
    2
    A
    x
    (A
    x
    )
    2
    C, D,WL, T, E, (m)
    V ar(a
    x
    ) =
    1

    2
    A
    x
    (A
    x
    )
    2

    C, D,WL, T,(m)
    V ar(L
    g
    0
    ) = (S +
    Pe
    d
    )
    2
    (
    2
    A
    x
    (A
    x
    )
    2
    ) C, D,WL, E, (m)
    V ar(SA
    x
    Pa
    x
    ) =

    S +
    P

    2
    A
    x
    (A
    x
    )
    2

    C, D,WL
    = S
    2
    2
    Ax(Ax)
    2
    (1Ax)
    2
    benet premium, C, D,WL
    E(
    t
    L(x) | L(x) t) =
    t
    V
    t
    V = SA
    x+t
    P a
    x+t
    WL
    = S

    1
    a
    x+t
    ax

    benet premium, C, D,WL,E


    = S
    A
    x+t
    Ax
    1Ax
    benet premium, C, D,WL,E
    t
    V = (b
    t+1
    q
    x+t
    v P
    t
    ) + p
    x+t
    v(
    t+1
    V ) Discrete, T, WL
    V ar(
    t
    L(x) | L(x) t) =

    S +
    P

    2
    A
    x+t
    (A
    x+t
    )
    2

    C, D,WL
    = S
    2
    2
    A
    x+t
    (A
    x+t
    )
    2
    (1Ax)
    2
    benet premium, C, D,WL
    V ar(
    k
    L) = p
    x+k
    q
    x+k
    [v(b
    k+1

    k+1
    V )]
    2
    + v
    2
    p
    x+k
    V ar(
    k+1
    L) General
    a
    (m)
    x
    = (m) a
    x
    (m) UDD, not temp., not A
    (m)
    x
    A
    (m)
    x
    =
    i
    i
    (m)
    A
    x
    UDD, WL, T, De Moivre, not a
    (m)
    x

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