Hexun Insurance reports: On December 28, China's insurance industry released its third set of life tables, the China Life Insurance Industry Experience Life Tables (2010-2013), in Beijing. Yuan Xucheng, Director of the Life Insurance Supervision Department of the China Insurance Regulatory Commission (CIRC), attended the press conference and stated that life tables are the cornerstone and core infrastructure of the life insurance industry and will be widely used in product pricing, reserve valuation, cash value calculation, and other areas.
It was introduced that the second set of life tables currently used by the industry was released at the end of 2005. Over the past decade and more, population mortality rates have changed markedly and life expectancy has increased significantly; at the same time, insurance product types have become increasingly diverse, and the original two tables for pension and non-pension business can no longer meet the needs of refined product pricing. Therefore, targeting different insured populations, the third set of life tables comprises three tables.
Yuan Xucheng stated that, compared with the compilation of the previous two sets of life tables, the third set involves an enormous volume of sample data. A total of 340 million policies and 1.85 million claim records were collected this time, covering a population of 180 million—the largest sample size in the world. In addition, the third set of life tables used data mining to complete the cleansing of 95% of claims data, with an accuracy rate above 97%.
Wang Zheng, Secretary-General of the China Association of Actuaries, revealed that the third set of life tables will not have a major impact on the future development and pricing of insurance products. He said that product pricing is based on three parameters—the mortality margin, the expense margin, and the interest margin—and that different products involve different considerations; the mortality margin is not the main factor among these three.
It is learned that the third set of life insurance life tables will be officially put into use on January 1, 2017. The CIRC stated that the next step will be to launch the revision of the critical illness incidence tables, further consolidating the technical foundation for the industry's development and fully supporting the work of ensuring that "the insurance industry remains true to insurance."
Source: Hexun Insurance 2016-12-28