Actuarial Report
A Actuarial Report is a business analysis report that includes quantitative predictions (using statistical analysis and probability theory to estimate future financial obligations).
- AKA: Actuarial Valuation.
- Context:
- It can (typically) make economic assumptions and demographic assumptions.
- It can (typically) analyze Statistical Data and Historical Patterns.
- It can (often) evaluate Financial Risks and Future Liabilities.
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- It can range from being a Short-Term Actuarial Report to being a Long-Term Actuarial Report, depending on prediction horizon.
- It can range from being a Simple Actuarial Report to being a Complex Actuarial Report, depending on analysis scope.
- It can range from being a Specific Actuarial Report to being a General Actuarial Report, depending on focus area.
- ...
- It can determine Projected Losses and Liability Accruals.
- It can assess Insurance Reserve adequacy.
- It can support Rate Development decisions.
- It can influence Fund Management strategies.
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- Example(s):
- Insurance Actuarial Reports, such as:
- Property-Casualty Insurance Reports, evaluating loss reserves.
- Life Insurance Reports, calculating premium reserves.
- Risk Assessment Reports, analyzing potential liabilities.
- Pension Actuarial Reports, such as:
- Pension Fund Valuations, estimating future obligations.
- Benefit Plan Assessments, analyzing long-term sustainability.
- Retirement System Analysiss, evaluating funding adequacy.
- ...
- Insurance Actuarial Reports, such as:
- Counter-Example(s):
- Financial Statements, which report historical performance rather than predictions.
- Market Analysis Reports, which focus on current market conditions.
- Audit Reports, which examine past transactions and compliance.
- Budget Reports, which plan future expenditures without statistical projections.
- See: Appraisal, Actuarial Task, Pension Fund, Statistical Analysis, Risk Assessment, Insurance Analysis.
References
2015
- https://www.irmi.com/online/insurance-glossary/terms/a/actuarial-report.aspx
- QUOTE: The product of an actuary's study of an organization's loss experience using probability theory and other methods of statistical analysis. Can be used to determine an insured's projected losses, a self-insured's liability accruals, the adequacy of a property-casualty (P&C) insurer's statutory loss reserves, or a life insurer's unearned premium (technical) reserves. May be the basis of rate development.
2014
- http://www.investopedia.com/terms/a/actuarial-valuation.asp
- QUOTE: An actuarial valuation is an type of appraisal which requires making economic and demographic assumptions in order to estimate future liabilities. The assumptions are typically based on a mix of statistical studies and experienced judgment. Since assumptions are often derived from long-term data, unusual short-term conditions or unanticipated trends can occasionally cause problems.
A common example where an actuarial valuation is in the valuation of a pension fund. It is usually easy to value a pension fund's assets because they primarily hold liquid securities such as stocks and bonds. However, it can be very difficult to value the liabilities of a pension fund. First, assumptions must be made to determine the total value of pension payouts that must be made in the future. Second, assumptions must also be made as to the expected growth of the fund's assets which will allow it to meet those obligations. If either set of assumptions proves to be significantly off, then there might be too little (or too much) funds in the future to pay pension benefits.
- QUOTE: An actuarial valuation is an type of appraisal which requires making economic and demographic assumptions in order to estimate future liabilities. The assumptions are typically based on a mix of statistical studies and experienced judgment. Since assumptions are often derived from long-term data, unusual short-term conditions or unanticipated trends can occasionally cause problems.