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The Extra Premium for a Premium Rebate Benefit in Recurrent Single Premium Group Life Assurance

Published online by Cambridge University Press:  11 August 2014

P. M. Madders
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Extract

1. Consider the question: Given the group life assurance premium for death benefits, what extra should be charged for a premium rebate on the basis that the cost of the rebate must be covered by the extra? Assume no additional administrative costs are involved.

2. Let the rebate be a proportion s of the excess of a fraction a of the total office premium P′ over the total claim C in a year. The rebate is then s(αP′– C). Usually the benefit is more complicated, but as explained in §8, the extra premium for the more complex benefit is related in a simple manner to the extras for the benefit described. In order to avoid scale constants the average sum assured per life is taken as unity.

Type
Research Article
Information
Journal of the Staple Inn Actuarial Society , Volume 16 , Issue 5 , November 1961 , pp. 346 - 357
Copyright
Copyright © Institute of Actuaries Students' Society 1961

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References

REFERENCES

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