- Froogled By:
- Elias Makere, FSA, MAAA
- Last Froogled:
ASOP 3 | §3.5 | CASH FLOW PROJECTIONS
The actuary should select assumptions in the cash flow projections that are consistent with those used in the development of the actuarial balance sheet and cohort pricing analysis (see sections 3.3 and 3.4).
The actuary should reflect revenues from all known sources (such as advance fees, periodic fees, additional fees, payments from non-contractual residents, third-party payments, and investment income). The actuary should reflect expenses from all known sources (such as operating expenses, capital expenditures, debt interest and principal payments, any cost of using an offsite health facility, and refunds due to refund guarantees).
In the cash flow projection, the actuary should develop the cash and investment balances at the beginning and end of each projection year.
ASOP 3 | Commentary Section 3.5 | COMMENT ON SECTION 3.5
| Comment | Response |
|---|---|
| Two commentators suggested the cross reference to ASOP No. 7, Analysis of Life, Health, or Property/Casualty Insurer Cash Flows, is not appropriate. | The reviewers agree and removed the cross reference. |
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