2015-04-15-奥纬咨询-Getting_the_Most_Out_of_AXIS,_Volume_2_12页_423kb

Consulting Actuaries: AXIS Newsletter Spring 2015 Summary

Executive Corner: Modeling PBR for Life Products

• VM-20 Overview: The New York State Insurance Department's Regulation VM-20 requires insurers to calculate reserves as the maximum of three components: net premium reserve, deterministic reserve, and stochastic reserve.
• NAIC Impact Study: A 2012 study showed that while 21 insurers adopted VM-20 for PBR, few found the difficulty manageable. Key challenges include regulatory interpretation, assumption selection, and software limitations.
• AXIS Advantages: AXIS offers efficient coding, parallel processing, integrated asset-liability modeling, and automates PBR-specific tasks like shock lapse adjustments and margin setting.

In the Spotlight: Long-Term Care (LTC) Modeling in AXIS

Claims Cost Approach

• Simplicity: Uses aggregate tables to estimate claim costs; suitable for straightforward products but limited in granularity.
• Implementation in AXIS: Uses "Other Benefits" to model claims cost. Requires managing numerous tables for each product characteristic variation.

First Principles Approach

• Granularity: Models specific risks like incidence, claim continuance, and utilization. Better for complex products but requires more data and computational resources.
• Implementation in AXIS: Uses incidence rates, terminations, and utilization inputs. AXIS supports care setting decrements, rider clauses (e.g., WOP), and benefit reductions via assumptions.

Comparison

• Claims Cost Approach: Easier setup, fewer calculations, but may overlook policy-specific details such as timing of payments or individual lapses. Best for companies prioritizing simplicity.
• First Principles Approach: More accurate, allows for detailed analytics, but demands higher investment. First principles is preferable for products with specific rider features or detailed granularity needs.

What’s New in AXIS

Batch Explorer Tool (BET)

• Hierarchy view for batch management; update 20150301.

Dataset Formula Functions

• Supports automation and distributed runs (versions 20150602).

Formula Tables Profiler

• Tracks and reports Formula Tables’ performance updates (versions 20150602).

Tips & Tricks

• Suppress Blank Rows: Enhances readability and focuses key data.
• Track Table Updates: Check timestamps and utilize "Where Used" to audit dependencies.

Conclusion

• Adapt existing systems to meet the challenges of PBR, particularly focusing on integrated modeling and software efficiency. Select LTC modeling approach based on granularity needs and data availability.