The text of this paper, together with the abstract of the discussion held by the Faculty of Actuaries on 19 March 2007, are printed in British Actuarial Journal, 13, III, 479-555.

The third Lecturer to the Faculty of Actuaries is Mr Karel Van Hulle. He is a lawyer by training, and is Head of Unit at the European Commission (Directorate-General ‘Internal Market and Services’), which he joined in 1984, after having served for eight years with the Belgian Banking Commission.

He was subsequently Head of Unit for Accounting Standards, Head of Unit for Financial Reporting and Company Law and Head of Unit for Accounting and Auditing. In that capacity he was closely involved with harmonisation in the fields of accounting, auditing and company law, both at European Union level and internationally, and served as the Commission's observer with the International Accounting Standards Committee. He was Secretary of the High Level Group of Experts on Company Law, which prepared the Commission's 2003 Action Plan on Company Law.

Since November 2004 he has been Head of the Insurance and Pensions Unit. In this function, his main responsibility is the preparation of the new solvency regime for insurance and reinsurance companies (Solvency II).

Although equity release market sales have been flat since 2003, the market has seen significant developments in terms of product flexibility, with greater levels of guarantees and drawdown schemes, in particular, leading to the reduction in average case sizes. All things being equal, products should have become more expensive for consumers, but the competitive environment which has driven product innovation has also resulted in lower product margins. This is all good for the consumer, but it is increasingly difficult for providers to reach target returns on capital, and this is deterring some prospective new entrants. One of the purposes of this paper is to investigate the profitability of typical schemes in the market at present, and so to address the question of whether competition has forced the market to function at non-profitable levels. In doing this, the paper also provides a benchmark for existing providers and potential new entrants, against which they can check the reasonableness of their own assumptions. We will aim to provide a rational pricing methodology, which can be adopted by any organisation active in the market, and we hope that this can support the market as it expands over the coming years. In order to produce a set of cohesive results, we have modelled a range of potential outcomes using a pricing basis which we consider to be broadly ‘average’. While we would encourage providers to compare our results with their own pricing assumptions, and to ensure that they are satisfied as to the reasons for any differences, there is a health warning, as our results should only be used as a check in this regard. If our ‘averages’ are suitable for use by some providers, then this is just co-incidence. In practice providers should adapt the assumptions made to suit their own product features, target market, expense profile and appetite for risk.

The text of this paper, together with the abstract of the discussion held by the Institute of Actuaries on 30 April 2007, in Manchester, are printed in British Actuarial Journal, 13, III, 579-636.

In our role, as actuaries, as long-term risk managers, climate change may have a considerable impact on some of our work, and, at the very least, we need to be able to answer clients' questions on the issue. The aim of this meeting is to come to a consensus on what that impact might be and how it can be managed. The impact on society and on the economy of climate change is subject to a great deal of uncertainty. We need to ascertain the risks; what they are, the degree of uncertainty, the potential magnitude and the time frame.

Earlier, the Environmental Research Group of the Actuarial Profession had conducted a survey of actuaries on climate change and its implications, by means of a questionnaire. The analysis of this questionnaire is printed here, as an indication of the reactions of those actuaries who responded.

Studying trends in mortality and morbidity has been at the core of traditional actuarial science since its beginnings. In recent times, the United Kingdom Profession has contributed to such studies in a number of different ways:

(1) through the work of the Government Actuary's Department on the analysis of national data;

(2) through the work of the Continuous Mortality Investigation Bureau on the analysis and graduation of insured lives data;

(3) through the work of various committees established by the Profession, e.g. the Critical Illness Trends Working Party; and

(4) through the work of individual members, or small groups of members, e.g. Richards et al. (2005).

This paper summarises the research resulting from two initiatives by the Profession designed to help actuaries and others to gain a better understanding of trends in morbidity and mortality: the Actuaries Panel on Medical Advances (APMA); and the Mortality Scoping Project.