Exam LTAM: Long-Term Actuarial Mathematics Study Guide
Life insurance, life annuities, premium calculation, reserves, multiple life and decrement models, and pension mathematics.
Overview
Exam LTAM covers long-term actuarial mathematics used in life insurance, health insurance, and pension valuation. Topics include survival models, life insurance and annuity pricing, premium calculation, reserves, multiple-life models, and multiple-decrement models. This is one of the more challenging preliminary exams due to the breadth and depth of the material.
Exam Format
- Duration
- 240 minutes (4 hours)
- Questions
- 30 questions (multiple-choice + written-answer)
- Pathway
- SOA
- Format
- Computer-based testing (CBT)
Topic Breakdown
Survival Models
10-15%Force of mortality, curtate and complete future lifetime, life tables, fractional age assumptions (UDD, constant force)
Life Insurance
15-20%Whole life, term, endowment, deferred insurance, varying benefits, actuarial present values
Life Annuities
15-20%Whole life, temporary, deferred, certain-and-life, annuities-due and annuities-immediate
Premiums
10-15%Net premiums, gross premiums, equivalence principle, loss-at-issue random variable
Reserves
15-20%Net premium reserves, gross premium reserves, prospective and retrospective methods, recursive formulas
Multiple Life Models
10-15%Joint-life and last-survivor statuses, independent and dependent lives, common shock model
Multiple Decrement Models
10-15%Associated single decrements, dependent rates, service tables, pension plan valuation
Recommended Study Approach
- 1
Build a solid understanding of survival models and life tables before moving to insurance and annuity functions.
- 2
Memorize the key actuarial notation (A_x, a-double-dot_x, etc.) and the relationships between insurance and annuity present values.
- 3
Practice net premium reserve calculations using both the prospective and retrospective methods.
- 4
Work through multiple-decrement problems using the associated single-decrement framework.
- 5
Study pension mathematics by understanding the different benefit formulas (career average, final average) and their actuarial present values.
- 6
Allocate extra time to the written-answer portion of the exam, and practice writing clear, structured solutions.
Related Topics
Life Contingencies
Life insurance and annuity valuation, survival models, and benefit reserves.
Pension Mathematics
Defined benefit plan valuation, funding methods, and pension risk management.
Survival Analysis
Kaplan-Meier estimation, Cox regression, hazard functions, and censoring.
Stochastic Processes
Markov chains, Poisson processes, Brownian motion, and their actuarial applications.
Insurance Regulation and Compliance
NAIC framework, risk-based capital, solvency standards, and regulatory filings.
Actuarial Professional Standards
ASOPs, Code of Professional Conduct, qualification standards, and ethical obligations.