How do you differentiate the short term growth and the long term growth using PPF.

(a) (4 points) EHP Life insurance company is adopting Principle Based Reserves (PBR) under VM-20. The same assumptions will be used for Life Insurance Illustration Model Regulation (LIIMR) testing as for PBR. Previous LIIMR testing demonstrated that all policies passed using the same modeling assumptions. EHP Life is changing its level term product to only have guaranteed premiums. Critique the following statements: A. All policies issued will pass LIIMR testing and no testing is required for the next certification since the assumptions are the same. B. The level term product will no longer require testing under the LIIMR and there no longer is a benefit of lower reserves by having non-guaranteed premiums under PBR. C. For modeling efficiency, the company will use the same models for PBR deterministic testing and for LIIMR testing. (b) (3 points) You are given: (in Millions) Company X Company Y Whole life Products issued Whole life Universal life Term Total Adjusted Capital 105 2,500 Authorized Control Level RBC 30 500 Total annual premium 45 290 (i) Assess life insurance Company X and Y's ability to satisfy the conditions required to qualify for the small company exemption under VM-20 PBR requirements. (ii) Determine additional information necessary to make the full assessment.(c) (4 points) You are given: Calculated Reserve 5.000 Cash surrender value 2.600 PV of future benefits under anticipated mortality 25,000 assumptions with margins PV of future benefits under anticipated mortality 21,500 assumptions without margins PV of future expenses 950 PV of gross premiums 19.000 Reserve at CTE70 5.000 Reserve at CTE80 7.850 Reserve at CTE90 9.000 Determine the following values under VM-20: (i) Net premium reserve (ii) Deterministic reserve (iii) Stochastic reserve (iv) Minimum reserve (v) Tax reserve according to Tax Cuts and Jobs Act of 2017 Show all work