Why use survival models?

(Jan 4, 2012)

We and our clients much prefer to analyse mortality continuously, rather than in yearly intervals like actuaries used to do in previous centuries. Actuaries normally use μx to denote the continuous force of mortality at age x, and qx to denote the yearly rate of mortality. For any statisticians reading this, μx is the continuous-time hazard rate.

We are sometimes asked why we prefer using μx, to which the lazy answer would be that this is what the CMI Technical Standards Working Party recommends, and it is how the the CMI has graduated all its tables since the early 1990s. Using μx to model mortality has a number of advantages, but here we will illustrate the simplest one.

One immediate advantage…

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Tags: survival analysis, survival models, force of mortality, hazard rate

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