Papers and reports

A former President of the Institute once remarked that whereas the graduation of a mortality table might be considered a specialized technique not required by the practising actuary, the efficient testing of any graduation submitted to him should be an integral part of his actuarial ability. The student anxious to equip himself in this respect encounters considerable divergence of opinion regarding the best method of testing a graduation. There is complete agreement as to the duality of purpose of such a test: smoothness and fidelity to the data are essential factors.

The Council of the Institute of Actuaries having asked me to prepare a new edition of the lectures which I delivered in 1908 and 1909, I wish in the first place to say that I consider this not only as a great compliment but as a request which I feel it my duty to endeavour to fulfil. I find, however, that the changes which have taken place in regard to all financial matters during the last 25 years are so fundamental that my task is much greater than I had at first imagined.

The recent paper by Dr Hagstroem (J.I.A. Vol. 70) directs attention to the very closely related subject of the effect on life assurance premiums of changes in the rate of interest. Some four years ago, in the course of an address before the American Life Convention, Mr V. R. Smith studied the relationship of the interest rate to life assurance premiums from a different angle. This note is an attempt to develop the mathematical theory underlying Mr SmithUOTEs method and to present some results on the basis of the A 1924-29 Table.