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Organisation : Actuarial Society of South Africa
Exam : A302 Exam
Document Type : Sample Question Paper
Category or Subject : Communications
Download Sample Question Paper :
A302 – May 2016 Exam : https://www.southafricain.com/uploads/2174-A302May.pdf
A302 – November 2015 Exam : https://www.southafricain.com/uploads/2174-A302Nov.pdf
302 – May 2015 Exam : https://www.southafricain.com/uploads/2174-A302May2015.pdf
A302 – October 2014 Exam : https://www.southafricain.com/uploads/2174-A302Oct.pdf
Actuarial Communications Sample Question Paper
Time allowed : Three hours
Instructions To The Candidate
1. Candidates will be issued with instructions to log in using a password (which you will be provided with at the exam center).
Related : Society of South Africa Actuarial Risk Management Sample Question Paper : www.southafricain.com/2170.html
2. Enter all the candidate and examination details at the beginning of each question. Ensure that your Candidate number appears at the top of each page handed in. [Select “Insert”, then “Header”, input your candidate number on blank header template and select “Close Header”].
3. Save your work continuously throughout the exam, on the provided computer’s hard drive.
4. You have 15 minutes at the start of the examination to read the questions. You are strongly encouraged to use this time for reading only, but notes may be made. You then have three hours to complete the paper.
5. You must not start typing your answers until instructed to do so by the invigilator/supervisor.
6. Mark allocations are shown in brackets on exam papers.
7. Attempt all questions, beginning your answer to each question on a new page.
8. Candidates should show calculations where this is appropriate.
9. Candidates are required to do a word count for the email– don’t forget to show this at the end of Question 2.
** The Actuarial Society of South Africa will not be held responsible for loss of data where candidates have not followed instructions as set out above.
Question 1 :
“According to Statistics South Africa (Stats SA), the country’s life expectancy is on the increase again, after a significant drop to 52 years in 2005. Stats SA’s mid-year population estimates put the 2014 life expectancy at 59.1 years for men and 63.1 years for women.”
This statement was made in a newspaper article and has raised concern among some members of a provident fund. They contend that there is no point in saving for retirement which is only at 65 and they should be allowed to take the monthly provident fund contributions as take home salary every month.
The trustees have approached you as the fund actuary to prepare 8-10 Powerpoint slides that can be used by the trustees to explain what life expectancy means to members of the fund. You will need to provide a suitable definition of life expectancy.
Question 2 :
Write an email reply to your mother of between 475 and 525 words (excluding the greeting and sign off). Your reply must include details of how much she will pay for the death benefit as well as for the cash back benefit and what she will get as a cash back payout. Compare this to what she would get from investing the total premium and only the cash back premium in an investment that earns 12% per annum compounded monthly, the best return available for the level of risk your mother is willing to take.
Explain to her how it is possible that the cash back payout can appear to be so generous. Draw her attention to the risks associated with taking up this cash back offer. Conclude by making a recommendation that she does not take up the offer.
There are five major product terms.
** The death benefit can be taken without the cash back benefit;
** The policyholder can only have the cash back benefit if they have the company’s death benefit;
** The premium for the cash back benefit is 30% of the premium for the death benefit;
** If the policy is still in force after 15 years and all the premiums have been paid in full, the policyholder receives 100% of the all the premiums paid;
** There are no expenses, commission or other charges on the cash back premium or benefit.
Contact Address :
Actuarial Society of South Africa
C/o Old Mutual Office 2
2nd Floor West End Mall
Jan Smuts Drive