Reply To: Actuarial Soundness
tanmay
Actuarial Soundness means the Program is projected to have the funds needed to pay future obligations as determined by an actuary. The actuarial formula incorporates several factors, including estimated future tuition, projected inflation and investment returns.
Actuarial soundness is much easier to define in theory than to evaluate in practice. Actuaries must develop statistical estimates based on a variety of information including demographic and diagnostic information on the relevant population and assumptions or forecasts of how these factors may change over time. If complete and accurate information is unavailable, it might not turn out to be actuarially sound in practice.
Sent from my SM-J700F using Actuarial Info mobile app
Where this is used? In Insurance, ths looks like reserving and in EB, this is Liability. I mean’t everything is projected generally but is there any place in practical where we use this term in its actual?