96 LV= Annual Report 2012
Notes to the Financial Statements continued
31 December 2012
25. Long-term insurance and investment contract liabilities valuation assumptions (continued)
Mortality rate tables 2012 2011
Non-profit temporary assurances (original LVFS) AM80/AF80 AM80/AF80
Non-profit temporary assurances TMN00/TMS00 TFN00/TFS00 TMN00/TMS00 TFN00/TFS00
Whole of life assurances AMC00/AFC00 AMC00/AFC00
Other assurances AM92/AF92 AM92/AF92
Annuities in payment Males: 100% RGA 2011 tables Males: 100% RGA 2011 tables
with CMI_2009 1.25% LT with CMI_2009 1.25% LT
Females: 100% RGA 2011 tables Females: 100% RGA 2011 tables
with CMI_2009 1% LT with CMI_2009 1% LT
Appropriate adjustments were made to the standard mortality tables to take account of actual experience and publicly available market
data.
Morbidity rate tables 2012 2011
Permanent health insurance
a) active lives CMIR12 CMIR12
b) claims reserves CMIR12 CMIR12
Critical illness Reinsurer rates Reinsurer rates
Appropriate adjustments were made to the standard morbidity tables to take account of actual experience and publicly available market
data.
Per policy expenses – regular premiums 2012 2011
Non-profit temporary assurances £18.15 £18.11
Whole of life assurances £14.71 £16.06
Permanent health insurance:
a) active lives £27.54 £25.16
b) claims reserves (per policy in claim) £650.49 £552.29
Critical illness £27.61 £29.86
Other assurances £34.93 £32.54
Annuities in payment £48.00 £38.00
Other assumptions
Best estimate assumptions are set for inflation, mortality, expenses and persistency. The future expense inflation assumption is
modelled as RPI (2011: RPI + 0.7%).
Options and guarantees
There are no significant options and guarantees in the non-participating business.
iii) Investment and long-term linked insurance contracts
The provision for unit linked pensions is equal to the value of the assets to which the contracts are linked. There is one product included
within the linked fund which is classified as an investment product and the liability is included within the long-term linked insurance
contract liabilities.
The provision for property-linked liabilities is equal to the value of the assets to which the contracts are linked and is included within
investment contract liabilities.
The provisions for index-linked permanent health insurance claims and index-linked temporary assurances have been calculated using the
same mortality and morbidity assumptions as used for the corresponding non-linked liabilities for both 2012 and 2011.
Interest rate 2012 2011
Unit linked pensions (original LVFS) Gilt yield + risk premium + margin for risk and uncertainty 1.90%
Mortality rate tables 2012 2011
Unit linked pensions (original LVFS) 92% AX92C20 80% AX92C20
b) Liverpool Victoria Life Company Limited - Ordinary Long Term Fund
i) Participating insurance contracts
Liverpool Victoria Life Company Limited has no participating business.