Projection of a mortality table

[Gary]

A plan requires that the act equiv mortality table be the 1971 GAM for males projected to 1978 using scale E.

I applied the scale incorporated in my spreadsheet program and it resulted in a small change in the q's, relatively, and a small change in for eg. the age 65 annuity. I don't recall exactly, but I believe the impact on the age 65 annuity was maybe 1% or so.

My questions are:

1. Does it make sense that the impact would be this small?

2. Does anyone have a copy of the scale E and know where it originated?

Perhaps it wasn't applied correctly. My feeling is that applying a mortality projection scale requires the factor (less than one) to be multiplied by the nth power, where n is the number of years projected out. i.e. in my case it would be 7 (1971 to 1978). Finally this factor is applied to the q's resulting in lower q's, thus higher annuity factors.

Any comments?

[david rigby]

Found it.

TRANSACTIONS OF SOCIETY OF ACTUARIES

1971 VOL. 23 PT. 1 NO. 67

Discussion of new scales D and E begins on the sixth page of this article:

http://www.soa.org:80/library/tsa/1970-79/...V23PT1N6724.pdf

[FAPInJax]

Your understanding is correct from what I remember as well. It may just be the projection scale and the limited projection period did not make enough difference.

[Gary]

Thanks for the responses.

Gary

[david rigby]

More help from the Society of Actuaries website.

Go to this link http://www.soa.org/tablemgr/tablemgr.asp , read the qxtables.txt file, and scroll down to see that many different projection scales are available.