STAT 2801 Life Contingencies

Tutorial 1
BASIC ACTUARIAL NOTATION

1. The future lifetime of a new-born infant is assumed to follow the distribution

F(x) = 1 – e–0.01x.

(a) Find the survival distribution and force of mortality.

(b) Express the following probabilities in actuarial notation and find their values.
(1) a new-born infant dies no later than age 45,
(2) a new-born infant dies after age 45 but no later than age 80,
(3) a person age 20 survives to age 40,
(4) a person age 30 dies no later than age 80.

(c) Explain whether this distribution is suitable for modeling human lifetime.

2. Given 1| qx + 1 = 0.095, 2| qx + 1 = 0.171 and qx + 3 = 0.2 . Find qx + 1 + qx + 2 .

3. If 10 p30 = 0.8 and 20 p30 = 0.6, find the probability that at least two of three persons
now age 30 will die between ages 40 and 50.

x
4. (a) Given μ(x) = for all x > 0, find 20|10 q5 .
100
(b) Given t | q x = 0.1 for t = 0, 1, … 9. Find 2 px + 5 .

(c) Given μ(x) = kx for all x > 0 and 10 p35 = 0.81, find 20 p40 .

LIFE TABLE FUNCTION

5. If mortality follows De Movire’s law with limiting age ω, find the mean, median and
variance of T(x).

6. For a cohort, lx = 121 − x for 0 ≤ x ≤ 121. Find the probability that a life age 21 will
die after attaining age 40, but before attaining age 57.

7. Given that the curve of death is constant up to the limiting age ω = 100, find the mean
and variance of T(88).