III IC-26 case studies
III IC-26 · Put your knowledge to work in context.
IC-26 Life Insurance Finance is one of the professional examination subjects listed by the Insurance Institute of India (III) under its Professional Examination stream, alongside papers such as IC-01 Principles of Insurance and IC-02 Practice of Life Insurance. It is a specialised subject for candidates building a finance-oriented qualification in the life insurance sector, typically associates working in accounts, finance, actuarial support, investment or compliance functions who need a working command of how life insurance money is raised, invested, accounted for and reported. The III IC-26 case studies are 5 cases and about 2,279 words.
1Universal Life No-Lapse Guarantee Reserve Strain
A mid-sized mutual life insurer carries 12,400 universal life policies with no-lapse secondary guarantees. Aggregate face amount is 2.2 billion, account value is 390 million, and the AG 38 reserve is 1.52 billion.
504 words, about 3 min2Term Block YRT Rate Increase and Recapture Decision
A life insurer has a closed block of 75,000 five-year renewable term policies with 9.0 billion of face amount. Seventy percent of the mortality risk is ceded under a yearly renewable term treaty.
459 words, about 2 min3Participating Whole Life Dividend Scale Under Stress
A mutual insurer's participating whole life block contains 55,000 policies with 4.1 billion of face amount. The current dividend scale has a 5.4% dividend interest rate, but the net portfolio yield is 4.8% and expected to fall as reinvestment occurs at 4.2%.
454 words, about 2 min4Captive Reserve Financing and LOC Renewal Risk
An insurer cedes 2.0 billion of XXX and AG 38 reserves to a captive reinsurer. The captive holds 300 million of letters of credit from two banks, priced at SOFR plus 300 basis points, maturing in 18 months; the parent provides a guarantee.
455 words, about 2 min5Closed Block Acquisition Bid and Embedded Value Adjustments
A life insurer is bidding for a closed block of traditional whole life policies from another company. The block has 6.0 billion of face amount, 2.4 billion of statutory reserves, and 210 million of DAC.
407 words, about 2 min