Working papers 5, 6 and 7 - New graduations of Income Protection termination experience

A Working Party of the Income Protection (IP) Sub-Committee have been focusing on producing new graduations of Income Protection (also known as PHI) experience. The new graduations are intended to update the graduations of the 1975-78 Individual Standard Male experience presented in C.M.I.R. 12 and are similarly based around the multi-state model approach of C.M.I.R. 12.

The new graduations will be based on the experience of Male, Occupation Class 1 lives for Individual IP business in the period 1991-98.

The multi-state model approach demands that the graduation of the termination experience is carried out before completing the graduation of inception experience. The Working Party have produced three inter-related papers which it is intended should eventually be published, together with a paper (or papers) on the inception experience, in a future volume of C.M.I.R.

The three papers are:

Working Paper 5 The Graduation of Claim Recovery and Mortality Intensities for the Individual IP experience for 1991-98 of Males, Occupation Class 1.

Working Paper 6 Date-Related Features of Individual Income Protection Claims 1975-1998.

Working Paper 7 >The Claim Termination Experience of Income Protection Business, 1991-98, for Other Male Occupations, Females and Group.

Working Paper 5 is the main paper describing the development of the new graduations. It is intended that a further section comparing the new graduations with the old C.M.I.R. 12 graduations will be added before final publication in C.M.I.R.

Working Paper 6 describes some features which emerged during the detailed examination of the claims records that took place during the course of the graduation.

Working Paper 7 compares the experience of other areas of the IP experience with the new graduations which were based on the Male, Class 1 experience.

Working Paper 5 describes the main graduation work and as such is the one for which comments would be most valued. Papers 6 and 7 are supplementary in nature, but any comments would still be welcome.

Please send any comments by 31 July 2004. In the meantime, the Working Party will continue work on the graduation of inceptions for the same experience.

Comments may be posted to

Peter McGurk
Continuous Mortality Investigation Bureau
Cheapside House
138 Cheapside
LONDON
EC2V 6BW

Email: ip@cmib.org.uk

Peter McGurk
Secretary of the CMI IP Sub-Committee

7 May 2004