Experience Studies
The Experience Studies tool compares actual versus expected active decrements, election probabilities, salary growth and inactive mortality for several years of historical data. The tool is designed to use “n” years worth of valuation data, with one database specified per year. In other words, if a Valuation has been performed for each of the last “n” years (and, except for the salary field, the same field names have been used from year to year), no additional data work should be necessary to run an Experience Study. The experience of all years is aggregated: to isolate results by year, perform a separate Experience Study for each year.
To run an Experience Study, choose the Experience Studies command from the Tools menu.
The first dialog box displayed is the library of all Experience Studies previously specified, if any, in the current Project. An asterisk next to the name of an Experience Study indicates that the study has not been run. An unexecuted Experience Study can be run by selecting it and clicking the Run button in the next dialog box. Click the New button to define a new Experience Study.
The items requested in the Experience Study dialog box are as follows:
Name is the description, by which it will be displayed in the Experience Studies Library, of the Experience Study currently being defined. You are encouraged to use a name that will readily allow you or a colleague to understand the underlying nature of the study.
Select the assumptions to study contains check boxes for each category of assumptions available for study. For Actives & Vested Valued Through Actives, you may study Decrements and Election probabilities. (Note: You will be able to study election probabilities only if election probabilities apply to a Benefit Definition in the Plan Definition under study.) You may also study the Salary growth of Continuing actives and Mortality for Inactives.
Select a topic to edit contains entries for each category of information (topic) found under the Experience Studies command. Depending on the actuarial Valuation Assumptions you choose to study, some of these topics may not be necessary and will not appear. Click the name of a topic to access its parameters:
Databases & Census Specifications
Active & Vested Valued Through Active Data
Benefits Received by Decrementing Actives
Click the Run button to execute the Experience Study. ProVal will check for completion of all specified parameters, and, if no errors are found, execute the Experience Study. An indication that the Experience Study is running will show on the screen during execution.
When the Experience Study is complete, ProVal displays the Experience Study parameters and reports for the selected assumptions.