PPA Valuations

[Guest Doogie61]

I have another question ....by the way....I love this forum all you guys and gals are great!

Now on to the matter at hand....lol

How many of you use preretirement mortality when calculating the Target Normal Cost and Funding Target?

Most of my DB plans are under 10 lives....we're a small actuarial firm.

[SoCalActuary]

None in the under 100 life plans. No credible expected death probability for this size group.

[ScottR]

I have another question ....by the way....I love this forum all you guys and gals are great!

Now on to the matter at hand....lol

How many of you use preretirement mortality when calculating the Target Normal Cost and Funding Target?

Most of my DB plans are under 10 lives....we're a small actuarial firm.

If the plan's death benefit is PVAB, I generally don't use a preretirement mortality discount. It doesn't make sense to discount the value of future benefits for the probability of dying before assumed retirement date, unless you also value the expected death benefit payouts.

For large plans with no death benefits, or QPSA only, I often do use preret mort.

... Scott

[carrots]

Ditto to SoCal and Scott