FSA courses

CP 321

Disability, Long-Term Care, and Long-Duration Health Contracts

2 discussions

Explanation

CP 321: Long-duration health assumptions can interact

Morbidity, recovery, mortality, lapse and expenses can affect a long-duration contract together. The direction of a sensitivity depends on the benefit and guarantee structure. Separate a plausible scenario from a statistical percentile.

Original practice scenario

In an original long-term-care scenario, longer claim duration increases benefit payments while lapse assumptions affect premium recovery. Trace both effects and state any dependence assumption. Explain what claim-duration data and segmentation would support a revised recovery assumption.

Study check

Write the assumptions, the decision being supported and one limitation. Use the current course syllabus for the required terminology and scope; this introductory guide is not a complete course summary.

Reading sources

Official syllabus and resources

ActNet editorial guide · October 1, 2026 · Original illustrative examples.

0 repliesOct 1

Explanation

CP 321: Disability models need recovery and death transitions

A disability cash flow depends on whether a claimant remains disabled, recovers or dies. Duration in state and benefit provisions can matter. A single probability of entering disability does not value the whole benefit stream.

Original practice scenario

For an original monthly model, track opening disabled lives, recoveries, deaths and continuing claims. Attach payments to the appropriate state and timing. Explain why a year-end occupancy probability may miss payments made earlier during claims that later recovered.

Study check

Reading sources

Official syllabus and resources

ActNet editorial guide · October 1, 2026 · Original illustrative examples.

0 repliesOct 1