Introduction_to_Prophet

Prophet
Enterprise-wide Actuarial Modelling
Introduction to Prophet Tutorial
Release 2022 Q2
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Contents
Part 1 - Prophet Professional Tutorial 1

Welcome to the Prophet Professional tutorial 2
About this tutorial 2
Prerequisites 3
Scenario 3
1 - Setting up a simple product 6

Learning objectives 7
Starting Prophet and creating a new workspace 7
Creating the product 9
Selecting the indicators 10
Specifying the input variables 13
Saving the product 25
Additional information 26
Lesson summary 28
2 - Setting up model point files and tables 29

Setting up the model point file 30
Setting up a parameter file 33
Setting up a global file 35
Lesson summary 37
3 - Setting up, running and reporting on a product 38

Setting up a structure 39
Setting up a run setting 40
Running the product 48
Viewing results produced in a run 51
Lesson summary 54
4 - Reporting on dependencies in Diagram View 55

Opening Results Diagram View 56
Viewing variable dependencies 58
Filtering views 59
Identifying changes required for enhancements 60
Lesson summary 62
5 - Updating libraries and products 63

Adding a new variable to the library 64
Updating the product 67
Viewing scenarios that show the effects of product changes 75
Identifying an error in the run 77
Lesson summary 78
Conclusion 78
ii
Part 2 - Appendices 79
A - Further topics 80
Regenerating products 81
Re-scanning products using Auto-Scan 81
B - Conventional product input files 83

Model point files 83
Parameter file 83
Global file 83
C - International product input files 84

Model point files 84
Parameter file 84
Global file 84
1
Part 1 - Prophet Professional Tutorial

Welcome to the Prophet Professional tutorial About this tutorial 2
Welcome to the Prophet Professional tutorial
FIS' Prophet solution is a leading enterprise-wide actuarial modelling system that helps insurance and financial services
companies meet reporting responsibilities, improve risk management, and develop more profitable products faster.
Prophet uses customisable actuarial libraries for all major product types, including regional variations. It provides the
transparency, performance and control required by today's actuaries and risk managers through integrated financial
modelling and data management capabilities. Prophet is used by more than 10,000 users at nearly 1000 customer sites in
over 70 countries.
Prophet Professional is the desktop platform. It is an integrated suite of actuarial systems used primarily by insurance
companies to perform actuarial calculations including:
n Profit testing
n Projections
n Statutory valuations
n Asset liability modelling
n Stochastic modelling and
n Risk management
In this tutorial you will gain an overall view of the main features of FIS Prophet, set up and run calculations for a single
traditional insurance product using a library containing variables used for the calculations, view the generated results and
use Diagram View to analyse and update the product.
The tutorial also shows you how to monitor the effects of changes made to a product and how new calculation variables can
be added to a library.
Further help can be found in the Prophet Professional User Guide, and you can also access the Help file by pressing F1
while you are using Prophet.
If you would like information about our Prophet training courses, see www.prophet-web.com/support/training/.
About this tutorial

This tutorial will take you through all the stages needed to create and run a product in Prophet Professional, including
reporting on the product and its dependencies. You will then learn about maintaining and updating a library and updating
the product to use the updated library. Finally you will learn about some other features that you may find useful when using
Prophet Professional to create your own products.
This tutorial consists of the following lessons:
Setting up a simple product

In this lesson you will set up a simple Prophet product. Products are the central components of Prophet and contain the
formulas and inputs used to model each insurance policy. For details see Setting up a simple product.
Setting up test model point files and tables

This lesson introduces you to the Prophet Table Editor. You set up some policy data to be used by the product specified in
Lesson 1, in this lesson you will set up the tables it uses. For details see Setting up model point files and tables.
Welcome to the Prophet Professional tutorial Prerequisites 3
Setting up, running and reporting on a product

In this lesson you will set up a run setting to project the product you created in Lesson 1, and then execute the product using
the data and tables set up in Lesson 2. Finally you will examine the results from within Prophet. For details see Setting up,
running and reporting on a product.
Reporting on dependencies in Diagram view

In this lesson you will use Diagram view to inspect the formulas used in your product and the dependencies between them.
This facility is useful both for understanding how the formulas interrelate and for debugging purposes. For details see
Reporting on dependencies in Diagram View.
Maintaining an actuarial library and updating the product

In this lesson you will be introduced to the processes involved in updating the underlying library. You will add a new variable
to the library and update your product to use it. You will also make a number of further changes to your product so that you
are introduced to some more Prophet features. For details see Updating libraries and products.
Further topics
In this lesson you will learn about a number of further features of Prophet, such as Regenerate and Auto-Scan. For details
see Further topics.
Conventional and International reference sections

These two sections contain the definitions of all the variables and tables used and produced as you work through the
tutorial using either the Conventional or the International library.
You can compare your products and tables with these to check your work and to help you diagnose any problems that may
arise during the tutorial. For details see Conventional product input files and International product input files.
Prerequisites
Before you tackle this tutorial, you are expected to have a working knowledge of using Windows applications, and Release
2020 Q2 service pack 3 or later of Prophet Professional installed on your computer.
Before you start this tutorial, you may want to read the chapters on Concepts and Terminology and Setting up a product in
the Prophet User Guide. This will give you a background to some of the screens, menus and options that are available.
In this tutorial you will be creating and managing traditional insurance products using either the Conventional or
International library supplied with Prophet.
n The Conventional library is focused on the product features common in the UK and is also applicable in other markets
such as Australia and South Africa.
n The International library is focused on the features common in continental European markets, except for the German,
French and North American markets for which specific libraries are available.
Note: This tutorial does not support the German, French or North American libraries.
Scenario
As you work through this tutorial you will learn how to use the features of Prophet Professional by creating a Prophet
workspace that includes a simple product.
The product that is modelled in this tutorial is a simple one so that it can be set up using either the Conventional or the
International library. The following table gives the product details.
Welcome to the Prophet Professional tutorial Scenario 4
Benefits The product is a non-profit endowment, so there is a guaranteed sum assured payable on death
or maturity.
A surrender value of half the premiums paid, accrued with 5% interest p.a., is payable in the first
two years. After that, the surrender value is equal to the net premium reserve using 100% of the
mortality table AM92 Ultimate for the Conventional product and GKM80 for the International
product and an interest rate of 5%.
Premiums Premiums may be paid annually, half yearly, quarterly or monthly.
Expenses Initial expenses are currently 160 per policy. Renewal expenses are currently 24 per policy per
annum and are expected to grow in accordance with the Consumer Price Index (assumed to be
4% per annum).
Commission The office pays an initial commission as a percentage of the first year's premiums, according to
the following table. This is paid in full on inception with “clawback” if the policy lapses before 2
years' premiums have been paid in the case of the Conventional product and 1 year in the case
of the International product. Commission rates for intermediate numbers of years are obtained
by interpolation. Renewal commission of 3% of premiums is paid after the first year.
Policy Term in Years Initial Commission %
0-5 10
10 25
15 35
20 - 30 40
Taxation For the Conventional product you will assume that the office is a mutual. Hence, taxation will be
on an "investment income minus expenses" basis with tax rates assumed to be 20% on franked
investment income and 25% on other income less expenses.
For the International product profits are taxed at 33%.
Reserving The net premium method is used for reserving purposes, using 100% of the mortality table
AM92 Ultimate for the Conventional product and GKM80 for the International product, and an
interest rate of 3%. A Zillmer adjustment is not used.
The product will include a solvency margin. You will use the European solvency margin
requirements, namely 4% of the reserves and 0.3% of the sum at risk.
Mortality Experience The current mortality experience is 85% of the mortality table AM92. You will confirm this for the
Conventional product and 85% of the mortality table GKM80 for the International product. This is
expected to continue.
Lapses At present, lapse rates are as set out in the following table and this experience is expected to
continue.
Years in Force Lapse Rate (%)
≤1 10
≤3 7.5
thereafter 3
Future Investment The company expects to earn 7% gross on equities (made up of 3% income and 4% growth) and
Earnings 5% gross on fixed interest government stocks (all made up of income). The product is backed
75% by equity type investments and 25% by fixed interest type investments. 15% of the equity
type investments are assumed to be realised each year, with reinvestment into similar
investments.
Discount Rates Future profits will be discounted at three different rates of 6%, 8% and 10% to put a value on the
business.
Projection Data The product will be run using policy data as at 31 December 2021.
Welcome to the Prophet Professional tutorial Scenario 5
Tables used by products

n Model Point File. This file contains all the policy specific information, for example the age at entry of the policyholder.
n Global File. This file contains information which is the same for every product in the run, for example the consumer
price index inflation rate.
n Parameter File(s). These files are used for the product specific information, which is the same for all the policies of a
particular product, for example the annual renewal expense per policy for each product.
Note: The tutorial is primarily concerned with showing you how to use Prophet. It does not address actuarial issues
such as the appropriateness of the calculations for any specific company or country.
Lesson 1 - Setting up a simple product 6
Setting up a simple product
TOPICS IN THIS LESSON
Starting Prophet and creating a new workspace 7
Creating the product 9
Selecting the indicators 10
Specifying the input variables 13
Saving the product 25
Additional information 26
Lesson summary 28
Lesson 1 - Setting up a simple product Learning objectives 7
Learning objectives
The first lesson in this tutorial shows you how to use the main features of Prophet Professional to create a new workspace,
create a product and set it up.
Note: While working through the tutorial, if you are using the International library, replace "C_ENDT" with "I_ENDT" and
replace "Conventional" with "International" when entering a product or selecting a library.
This lesson includes the following objectives:
1. Starting Prophet and creating a new workspace.
2. Creating the product.
3. Selecting the indicators.
4. Specifying the input variables.
Note: At any time you can look at the Prophet Professional User Guide or Help file for more information on the Prophet
interface. To do this, click the File tab and on the backstage view click Help.
To view the online help, click Help Topics, or to view the user guide as a PDF file, click User Manuals and then
double-click the PDF for the Prophet Professional User Guide.
It is advisable to complete each lesson in one session. However, if this is not convenient you can pause at the end of an
objective, close Prophet and come back to the tutorial later.
Note: If you close Prophet before you finish defining input variables, Prophet saves the default definitions. You can
change these definitions as required as you work through the tutorial.
Starting Prophet and creating a new workspace

A workspace is the environment in which you work with Prophet and consists of objects such as products and libraries.
Some objects, such as products, are saved in the workspace file (prophet.prw). File objects such as table files that are
referenced in the workspace are usually stored in the same location as the workspace or in its subfolders.
To start Prophet:
1. If you are running Windows 7: From the Windows Start menu point to All Programs > Prophet Suite > Prophet
Professional and click Prophet Professional.
OR
If you are using Windows 8 or Windows 10: Press the Windows key on your keyboard and from the Start screen,
locate and click the Prophet Professional icon.
The Prophet Start page appears.

Lesson 1 - Setting up a simple product Starting Prophet and creating a new workspace 8
2. The main work area displays the Prophet website, which gives you the latest information and support tips. As with any
other tab, you can close the Start page.
Tip: To reopen the Start page, click the File tab and on the backstage view click Help, then click Start Page.
3. Click Create New Workspace.
If you have permissions enabled you need to enter your username and password as specified by your administrator.
The Create New Workspace dialog box opens.
4. In the New Workspace Location box, type C:\Prophet_Tutorial, and in the Description box type a meaningful
description of the workspace. In this case type Introduction to Prophet Tutorial Workspace.
5. Select the Install Template check box and if necessary select the Example Model Office template from the list, then
select the Install Libraries Only check box.
This is because the tutorial does not need the full example template as you will be creating the various elements as you
work through it, but you do need the standard libraries (Conventional and International) that are supplied with the
Example Model Office.
Tip: When you have completed this tutorial you can work through the Example Model Office tutorial to learn about
further aspects of Prophet Professional.
6. Click OK to create the new workspace. The application screen looks similar to the following:
Lesson 1 - Setting up a simple product Creating the product 9
You have now completed objective 1 for this lesson.
Creating the product

You can think of products in Prophet as computer programs. The only difference is that Prophet takes care of much of the
programming and you need only specify the actuarial calculations required. You set up products in Prophet to reflect both
your insurance products and your business requirements. For example, you can set up a number of conventional, unit
linked and summary products in order to calculate embedded values.
A product is associated with a library of actuarial formulas from which it is defined. For example, a conventional product is a
product defined using the Conventional library. Similarly, a summary product is a product set up using the Summary library.
In this tutorial you will use the Conventional or International library.
To create the product:

1. In the Explorer pane click Model Components. The Model Components tree structure opens in the top of the
Explorer pane.
2. On the Home tab click the arrow below New and then click New Product.
The Product Properties dialog box appears.

Lesson 1 - Setting up a simple product Selecting the indicators 10
Tip: If you want to look at the properties for an existing product, in the Explorer pane in the Products folder click
the product, and on the Home tab in the Edit group click Properties.
3. Complete the details in the Product Properties dialog box as follows:
Name n If you are using the Conventional library, type C_ENDT.
n If you are using the International library, type I_ENDT.
Note: The product name cannot be longer than 22 letters.

The rest of this tutorial refers to International or Conventional library users by reference to these
product names.
Description Type Tutorial Product.
Library In the list, click the library to use, either Conventional or International, depending on what you
have entered in the Name box.
Same As Leave this check box clear.
This setting allows you to specify that a product is the same as another product. In this case
Prophet would carry out exactly the same calculations as for that other product, but it uses its
own model point file, its own name when accessing parameter file(s) and produces its own
results, so you do not need to specify the calculation rules separately.
Level Number Leave Level Number at the default value of 10.
This option allows you to specify the order of processing of products and accumulations, but for
this tutorial leave it at the default setting.
Use in memory Leave this check box clear.
dynamic/stochastic This option allows you to perform dynamic runs in memory which speeds up the calculations, but
calculations is not needed for this tutorial.
Apply strong t-limiting Leave this check box clear.
This option allows you to optimise the calculated time periods in dynamic runs, but is not needed
for this tutorial.
Allow Parallel MP Leave this check box clear.
Processing (Multi-
Threading)
Allow Concurrent Leave this check box clear.
Model Point Batches
4. Click OK. The Select Indicators for Product dialog box appears. The next objective takes you through selecting
indicators for the product.
You have now completed objective 2 of the lesson.
Selecting the indicators

After associating the new product with a library, you need to select the indicators associated with the particular features you
want your product to have. For example, a regular premium policy would require the indicator REG_PREM. When you
select the REG_PREM indicator you can then select the input and core variables required to model a regular premium
product. In this tutorial you need to add the indicator SOLV_MARGIN.
1. When you have completed the Product Properties dialog box and clicked OK, the Select Indicators for Product
dialog box appears.
Note: If you are returning to the tutorial after a break, on the Start page open the Tutorial workspace, then in the
Explorer pane in the Model Components group, double-click the product to open it in the work area. On the
Object tab of the ribbon, in the Product group click Show Indicators.
This screenshot shows the dialog box for the Conventional product, but the International product is similar.
n The pane on the left lists the indicator categories. When you select a category, only those indicators associated with
the category are displayed in the other panes.
n The centre pane contains a list of available indicators that have not been selected for the product. You can click a
heading to sort the list by the heading.
n The pane on the right contains a list of selected indicators with their description and code. For a new product this
pane contains a list of indicators that are selected by default. For a description of the default indicators, see Default
Indicators. You can click a heading to sort the list by the heading.
n The pane at the bottom of the dialog box displays actuarial documentation for the selected indicator or indicator
category. The documentation explains the purpose of each indicator and the features that can be included in the
product if the indicator is selected.
2. To find the indicator you require, in the list of available indicators (in the centre pane) click the Name heading to
sort the indicators alphabetically, then scroll down the list to find SOLV_MARGIN.
3. To add the indicator to the list of selected indicators in the right pane, you could click the indicator and then click
the right arrow, or double-click the indicator. But for this tutorial, click Wizard to display the Indicator Selection
wizard.
The Indicator Selection wizard divides all the available indicators by category, with one step for each category.
4. Click Next until you get to the Solvency Margin category (Q).
n The Indicator Category pane displays a brief description of the category.
n Below that, the list of indicators shows all the indicators that are in the category.
n The pane to the right of the list of indicators displays some additional usage guidance. If the indicator is a function,
the pane contains a description of when the indicator should or shouldn't be used.
5. In the list of indicators, select the check box for SOLV_MARGIN, then click Finish to return to the Select
Indicators for Product dialog box.
SOLV_MARGIN is included in the list of selected indicators.
Tip: For more information on any of the indicators refer to the actuarial documentation in the bottom pane.
6. If necessary, in the left pane click All Indicators at the top of the list to display all the indicators.
7. In the Select Indicators for Product dialog box, click OK to accept the amended list. The dialog box closes and the
product is displayed in the work area, in the C_ENDT Preview tab.
Lesson 1 - Setting up a simple product Specifying the input variables 13
You have now completed objective 3 of the lesson. Next you need to specify the input variables.
Specifying the input variables

After you have selected the indicators to be used by the product you need to specify the input variables for the product.
Input variables define the calculations which can vary from product to product or from company to company. When you
create a new product, default definitions for each input variable are presented on the screen, based on the rules specified in
the associated library. For more detailed information about input variables, see Additional information.
At a later stage, core variables are added to the product to complete the specification of the calculations. Core variables are
not displayed since their definitions apply across all products.
In the C_ENDT Preview or I_ENDT Preview tab you can see that the status for all the variables, in the Status column, is
Not Defined. In this objective, you will look at all the definitions and either accept the default definition or edit it as required.
You can edit the definitions in any order, but for a new product it is sensible to define them in the order they are displayed in
the list. By default the variables are sorted by code, but you can click any of the headings in the product preview tab if you
want to change the sort order. For this tutorial, keep the variables sorted in the default order. (If you have changed the
order, in the product preview tab click the heading Code.)
As with indicators, each variable is assigned to a category by its variable code. This code is made up of two letters followed
by a two-digit number. The pane on the left lists the variable categories. When you select a category, only those variables
associated with the category are displayed in the other panes.
n To sort the variables by code, in the work area click the Code heading. The first variable in the list is AGE_AT_ENTRY,
which has the code AA40.
General variables
The General variables all have a code starting with A.
1. In the product preview tab, either click AGE_AT_ENTRY and on the Home tab click Open, or double-click AGE_AT_
ENTRY. The work area now contains a local tab for the variable definition, and the Design tab appears on the Prophet
ribbon.
In the AGE_AT_ENTRY tab, the default definition is Model Point. This means that when the product is run, Prophet will
read the value to be used for this variable from the model point file that you will set up for this product, later in the
tutorial.
2. You do not need to change the definition. On the Design tab click OK. The AGE_AT_ENTRY tab closes and Prophet
checks the definition for any syntax or similar errors.
3. In the C_ENDT Preview tab, double-click the next variable - SEX. The SEX tab opens.
The default definition is Model Point. You do not need to change the definition.
4. Because you are working through the variables rather than just opening a single definition, on the Design tab click
Next. The tab in the work area changes to the next variable in the list, ENTRY_YEAR.
ENTRY_YEAR has a formula definition, which for this tutorial does not need to change.
5. Accept the definitions for the following variables without changing them.
Variable Description Action

ENTRY_YEAR Year of entry Defined as a formula.
n On the Design tab click Next.
ENTRY_MONTH Month of entry Defined as a formula.
n On the Design tab click Next.
In the Formula Definition pane the formula definition references PER_TO_

VAL_M. When you accept the definition, Prophet adds PER_TO_VAL_M to the
list of variables. 1
POL_TERM_Y Policy term in Defined as Model Point.
years n On the Design tab click Next.
ADD_TERM_M Additional term Defined as zero.
in months n On the Design tab click Next.
ANN_PREM_PP Annual n On the Design tab click Next.

premium per
policy Note: This formula would need to be changed if the product had increasing
premiums.
ANNUAL_PREM Annual n On the Design tab click Next.

premium
Tip: You will often see pairs of variables structured like ANN_PREM_PP
and ANNUAL_PREM. The variable ANNUAL_PREM is normally given a
model point definition that specifies the current or original premium
whereas ANN_PREM_PP is given a formula definition that can be used to
specify how the premium varies over time.
1 Prophet expands the list of variables as you accept definitions - this approach is adopted so that variables are not
brought into the product unnecessarily. For example, if you had wanted to change the definition of ENTRY_MONTH
so that it did not use PER_TO_VAL_M, that variable would not have been needed in the product. These variables
(such as PER_TO_VAL_M in this example) are called secondary input variables.
6. When you reach PREM_PAYBL_M (number of months premiums payable) it contains a formula definition, but for this
tutorial it needs to be defined as Model Point.
7. On the Design tab, click Change Definition Type.
The Definition Type dialog box appears.
8. Click Model Point and then click OK.
Notice how the icon in the PREM_PAYPL_M tab has changed to reflect the new definition, from to .
9. On the Design tab click Next, and edit the next few variables as required, according to the following table.

PREM_FREQ Premium frequency Defined as Model Point
n Accept the default definition.
SUM_ASSD_PP Sum assured per policy Defined as Formula.
SUM_ASSURED Sum assured Defined as Model Point.
NB_INFL_ADJ New Business Inflation Defined as Formula.
Adjustment n Accept the default definition.
NB_INFLAT_PC New business Annual Defined as Formula.
Inflation PC n Accept the default definition.
SALES_FACTOR Sales factor This variable is a multiplier factor for future sales which is used for
new business projections.
INNER_SCEN_FILE Indicator to use inner Defined as Constant.
scenario file n Accept the default definition.
NS_INPUT_EXISTS Nested Input Available Defined as Constant.
CPI_GTH_PC Consumer price index Defined as Global.

inflation rate Accept the default definition.
Benefits variables
The Benefits variables all have a code starting with E.
1. On the Design tab click Next, and edit the next few variables as required, according to the following table.

DEATH_BEN_PP Death benefit per policy Defined as a formula.
MAT_BEN_PP Maturity benefit per policy Defined as a formula.
2. When you get to SURR_VAL_PP (surrender value per policy), you need to amend the formula, so that it adheres to the
description given in the initial scenario for this product. (For details see Scenario.)
Note: Type the text exactly as shown here. The text includes a deliberate error so that you can see how Prophet
handles errors. The error will be corrected later in the tutorial.
Replace the following lines:
IF t <= NIL_SURR_P_M THEN

0
With this text, typing directly into the Formula Definition pane in the work area, to define the surrender value at the end
of month t as equal to the surrender value at the end of month (t-1) plus half the premium paid in month t, accrued with
interest.
IF t <= 23 THEN
(SURR_VAL_PP(t-1) + PREM_INC_PP(t) * 0.5) * (1 + SURR_INT_PC/100)^(1/12)
Note: Prophet follows the standard conventions regarding the order of operations, which you could clarify by adding
extra brackets.
When typing the name of the variable to include in the formula, as you type the first few letters of the variable a tip
window appears, listing all the variables that start with those letters. Scroll to the required variable and then press Enter,
or press F3 to display the Insert Variable, Dimension or Enumeration dialog box, locate and select the variable and
click OK to enter it into the formula definition.
For further guidance on the syntax used in formulas, see Function syntax.
3. Continue editing the Benefits variables as per the following table:

SURR_NETPREM Surrender net premium Defined as a formula.
In the Formula Definition pane the formula definition

references secondary variable SURR_ZILLMER
(surrender Zillmer).
SURR_INT_PC Surrender interest rate Defined as a constant with a value of 0.
n Because the interest rate at which the surrender value is
calculated is 5% for this product, change the value to 5.
Tip: In practice it would be better to define SURR_INT_PC as

a parameter definition, but for the purposes of the tutorial this
step shows you how you can amend a constant definition.

SURR_ZILLMER Surrender Zillmer Defined as a formula.
SURR_ZILL_PC Surrender Zillmer Defined as a constant with a value of 0.
percentage n Accept the default definition.
SURR_NP_R_PC Restriction on the surrender Defined as a constant with a value of 95.
net premium as percentage n Accept the default definition.
of the annual premium
Reserving / Solvency / Accrual Methods variables

The Reserving / Solvency / Accrual Methods variables all have a code starting with F.
1. Accept the Reserving / Solvency / Accrual Methods variables as per the following table:

NET_PREMIUM Annual net premium Defined as a formula.
Note: As with ENTRY_MONTH, when you accept the default

definition, Prophet adds the secondary input variables VAL_
ZILLMER and NP_RESTRN_PC.
VAL_INT_PC Valuation interest rate Defined as a parameter.

VAL_ZILLMER Valuation Zillmer Defined as a formula.
n Accept the default definition. Prophet adds VAL_ZILL_PC.
VAL_ZILL_PC Valuation Zillmer percent Defined as a constant with a value of 0.
NP_RESTRN_PC Restriction on net premium Defined as a constant with a value of 95.
as a percentage of annual n Accept the default definition.
premium
VAL_SUM_ASSD Value of sum assured Defined as a formula.
VAL_NET_PREM Value of net premium n Defined as a formula.

UNEARNRES_PP Unearned Premium Res Note: Appears in I_ENDT using the International library only.
per Policy
Defined as a formula.
MIN_RES_PP Minimum reserve per policy Defined as a constant with a value of 0.
PE_DTHBEN_PP Period end death benefit Defined as a formula.
for solvency n Accept the default definition.
SM_RES_PC Solvency margin as a Defined as a constant with a value of 4.
percentage of reserve n Accept the default definition.
SM_SAR_PC Solvency margin as a Defined as a constant with a value of 0.3.
percentage of sum at risk n Accept the default definition.
Interest rates variables

The interest rates variables all have a code starting with G. The first five variables in this group represent the components
of the investment return. The values of these variables may change between groups of products. For instance, non-profit
and with-profit products are usually backed by different mixes of assets. You will amend these variables to refer to other
variables which will read the appropriate values from the global file.
1. Open the variable FII_PC (annual rate of franked investment income),which is currently defined as a Constant
definition.
2. On the Design tab click Change Definition Type, and in the Definition Type dialog box, click Formula, then click OK.
In the work area the FII_PC local tab now contains an empty formula.
3. In the Formula Definition pane type NP_FII_PC. When you click Next the variable NP_FII_PC is added to the list in
the C_ENDT Preview tab.
4. On the Design tab click Next. NP_FII_PC (non-profit franked income percentage) appears in the work area as a Global
definition. (You will edit this in the next lesson.)
You have edited the variable in the same way as you edited SURR_VAL_PP earlier, but there is an easier way to edit
this variable as the required formulas have already been set up as "alternative definitions". (Alternative definitions are
alternatives to the default definitions which have been set up in the libraries for a number of variables where commonly
used alternatives exist.)
5. On the Design tab click Next. UFII_PC (annual rate of unfranked investment income) appears in the work area as a
Formula definition.
6. On the Design tab click Select Definition.
The Select Definition from Library dialog box appears.
7. In the Indicator Expression / Description list, click NON PROFIT BUSINESS and then click OK. The definition of
UFII_PC changes the Formula definition to read from NP_UFII_PC. When you click Next the new variable, NP_UFII_
PC, is added to the list in the C_ENDT Preview tab.
8. Continue selecting definitions for the next few variables, accepting the secondary variables that are added, as per the
following table.

RCG_CHG_PC Annual rate of chargeable Select the definition NON PROFIT BUSINESS, and accept the
realised capital gain secondary variable NP_RCGCHG_PC that is added.
RCG_UNCHG_PC Annual rate of unchargeable Select the definition NON PROFIT BUSINESS, and accept the
realised capital gain secondary variable NP_RCGUNC_PC that is added.
UNRCG_PC Annual rate of unrealised Select the definition NON PROFIT BUSINESS, and accept the
capital gain secondary variable NP_UNRCG_PC that is added.
9. Edit or accept the remaining interest rates variables as per the following table:

DISC_A_PC Annual risk Defined as Global.
discount rate A n Accept the default definition. This allows it to be given the same value
for all of the products in your model office.

DISC_B_PC Annual risk Defined as Global.
discount rate B n Accept the default definition.
DISC_C_PC Annual risk Defined as Global.
discount rate C n Accept the default definition.
SOLV_INT_PC Interest rate on the Defined as a constant with a value of 0.
solvency margin n Change the definition to Global.
Tip: If you cannot remember how to do this, see General variables.
PER_TO_VAL_M Initial period to next For C_ENDT using the Conventional library:
valuation in months Defined as a formula.
For I_ENDT using the International library:

Defined as a constant with a value of 0.
Tip: The Formula Definition window includes an explanation of how

the formula is expected to work when used. You may wish to read the
description.
Tax variables
The tax variables all have a code starting with H.
1. Accept the tax variables as per the following table:
Variable Description
OTAX_FII_PC Office tax rate on franked investment income 1
OTAX_UFII_PC Office tax rate on unfranked investment income 1
OTAX_RCHG_PC Office tax rate on realised chargeable gain 1
OTAX_EXP_PC Office rate of tax relief on expenses 1
ACQ_EXP_TAX Acquisition expenses for tax purposes 1
IMM_EXP_REL Proportion of acquisition expenses for immediate relief 1
ANN_EXP_REL Annualise expense relief 1 = Y, 0 = N 1
OTAX_PROF_PC Tax rate on profits 2
1 Applies to the tutorial product C_ENDT, which uses the Conventional library.
2 Applies to the tutorial product I_ENDT, which uses the International library.
Commission variables
The commission variables all have a code starting with I.
1. Edit or accept the commission variables as per the following tables.


IC_PAYBL_PP Initial commission Defined as a formula that spreads initial commission payments over the first
payable per policy year, depending on the frequency of premium payments.
For C_ENDT using the Conventional library:

n Change the definition to the alternative definition from the library,
changing it to INDEMNITY COMMISSION PAID MTH 1, which is a
formula that pays all the initial commission in the first month.
Tip: If you cannot remember how to do this, see Interest rates

variables.
IC_RATE_PC Initial commission Defined as a parameter.

rate Change the definition type to Formula, and in the Formula Definition pane
edit the formula as follows:
IF POL_TERM_Y <= 10 THEN
3 * POL_TERM_Y - 5
ELSE IF POL_TERM_Y <= 15 THEN
2 * POL_TERM_Y + 5
ELSE IF POL_TERM_Y <= 20 THEN
POL_TERM_Y + 20
ELSE
40
If there are any syntax errors in the formula, an error message with the
probable location of the error is displayed. Correct any errors if necessary.
Note: This approach demonstrates how to use a formula to define initial
commission rates. A formula is only feasible if there is a pattern in the
values. In a later lesson you will see how these values can be entered in
a table that can be read by the product.
IC_EARNL_PP Initial commission Defined as a formula.

earned on lapses For C_ENDT using the Conventional library:
per policy n Accept the default definition.

n Change the definition to the alternative definition from the library,
changing it to EARNED UNIFORMLY OVER N MONTHS.
Tip: If you cannot remember how to do this, see Interest rates variables
on page Interest rates variables on page 18.
n Accept the secondary variables IC_EARNL_PC and IC_EARN_M that
are added.
IC_EARND_PP Initial commission Defined as a formula.
earned on deaths n Accept the default definition.
per policy
IC_RECOV_PC Percentage Defined as a constant with a value of 100.
commission n Accept the default definition.
recovered on
clawback

RC_PAYBL_PP Renewal Defined as a formula.
commission n Accept the default definition.
payable per policy
RC_RATE_PC is added as a secondary input variable.
RC_RATE_PC Renewal Defined as a Parameter.
commission rate n Accept the default definition.
RC_START_M Renewal The default for the month in which renewal commission commences. Since
commission start the renewal commission starts in the first month of the second policy year,
month the value 13 is correct.
Expenses variables
The expenses variables all have a code starting with J.
1. Edit or accept the variable definitions as per the following table:

INIT_EXP_PP Initial expense Defined as a formula, made up of three components: a fixed per policy
per policy expense, a percentage of the sum assured and a percentage of the annual
premium. To model this product you are just using a fixed per policy expense,
as explained in Scenario.
IE_INFLAT_PC_BASE Annual Initial Defined as a formula.
Expense n Accept the definition.
Inflation percent
IE_FIXED_BASE Fixed initial Defined as a Parameter.
expenses n Accept the definition.
IE_SA_PC_BASE Initial expense Defined as a Parameter.
as a percentage n Change the definition type to constant with a value of 0.
of sum assured
IE_PREM_PC_BASE Initial expense Defined as a Parameter.
as a percentage n Change the definition type to constant with a value of 0.
of premium
REN_EXP_PP Renewal The variable RE_START_M is the month in which renewal expenses are first
expenses per assumed to be incurred. This normally depends on how expenses are
policy analysed in the office. The formula indicates that renewal expenses are
incurred in each month during the policy term in and after this "start month".
Their amount increases with inflation from the start of the projection period.

The last line in the first part of the formula allows renewal expenses to be
expressed as a percentage of the annual premium. As you are only assuming
fixed renewal expenses, you could delete this line from the formula but this
would make your product less flexible.
RE_AP_PC_BASE Renewal Note: Appears in I_ENDT using the International library only.
expenses as a
Defined as a constant with a value of 0.
percentage of
annual premium

RE_START_M Month in which Defined as a constant with a value of 2.
renewal n Accept the default definition.
expenses
commence
RE_FIXED_Y_BASE Fixed annual Defined as a Parameter.
renewal n Accept the default definition.
expenses before
inflation
M_RE_INFLAT Monthly renewal Note: Appears in C_ENDT using the Conventional library only.
expense inflation
Defined as a formula.
RE_INFLAT_PC_BASE Annual renewal Defined as a formula.
expenses n Accept the default definition.
inflation
percentage
CPI_GTH_PC Consumer Price Secondary variable introduced by RE_INFLAT_PC_BASE, defined as a
Index inflation Global.
rate n Accept the default definition.
RE_NBI_ADJ Annual new Defined as a formula.

business n Accept the default definition.
expense inflation
adjustment
RE_RESERV_PC_ Renewal Defined as a Parameter.
BASE expense as a n Change the definition type to constant with a value of 0.
percentage of
reserve
Mortality variables
The mortality variables all have a code starting with K and relate to the mortality aspect of the tutorial product.
1. The first mortality variable is Q_EXP_PN, which specifies the mortality table used for the experience basis. The work
area for a Mortality Table definition (this is from the C_ENDT product) looks like this:
For C_ENDT using the Conventional library, the mortality table AM92 is used.

For I_ENDT using the International library, you need to use the mortality table GKM80. To change the table:
n In the work area, click Browse, and navigate to the location of the mortality tables. This location is set when Prophet
is first installed.
For example, for Prophet Release 2018 Q3 or later installed on a Windows 10 system the location is
C:\ProgramData\ProphetSuite\Prophet\Mort, or for Prophet 9.0 Update 4 or earlier on a Windows 10 system the
location is C:\ProgramData\SunGard\Prophet\Mort.
Tip: To check the location of the mortality tables, click the File tab and on the backstage view click Options,
then in the Options dialog box in the list on the left click Calculation Engine.
Note: GKM80 is an ultimate table, but the Select/Ultimate setting can be left unchanged as Prophet will ignore
this setting for an ultimate table.
2. Edit or accept the remaining mortality variable definitions as per the following table:

PROP_EXPQ_PC Percentage of experience mortality Defined as a Parameter
rates n Accept the default definition.
Q_SURR_PN Surrender mortality rates Defined as a mortality table.

n Change the mortality table to GKM80 as above.
PROP_SURQ_PC Percentage of surrender mortality Defined as a constant with a value of 100.
rates n Accept the default definition.
Q_VAL_PN Valuation mortality rates Defined as a mortality table.

n Change the mortality table to GKM80 as above.
PROP_VALQ_PC Percentage of valuation mortality Defined as a constant.
rates n Change the definition type to Parameter.
Tip: If you cannot remember how to do this, see

General variables
Decrements variables
The Decrements variables all have a code starting with L.
1. The first variable is ANN_LAPSE_PC_BASE, the percentage of policies that lapse or surrender each year. It is defined
as a formula that allows you to enter different lapse rates in the first year, the second year and then subsequent years.
The tutorial product requires the lapse rates to be defined for the first year, for years 2 and 3 and then for subsequent
years, so you need to edit the formula. (For details see Scenario.)
The line you need to edit is:
ELSE IF t <= 24 THEN
n Change the 24 to 36 so that the next line, YR2_LAPSE_PC * YR2_LAPSE_SY, will apply during the second and the
third years.
2. Accept the remaining decrement variable definitions.
Lesson 1 - Setting up a simple product Saving the product 25
YR1_LAPSE_PC Lapse rate in first year.
YR2_LAPSE_PC Lapse rate in second year.
YR3_LAPSE_PC Lapse rate in third and subsequent years.
SKEW_FACTOR Lapse and paid-up policy skewness factor.
LAPSE_TIMING Lapse timing.
YR1_LAPSE_SY Year 1 lapse rate sensitivity.
YR2_LAPSE_SY Year 2 lapse rate sensitivity.
YR3_LAPSE_SY Year 3 and subsequent lapse rate sensitivity.
ANN_MAT_PC Annual maturity rate.
Initial Values variables

The Initial Values variables have a code starting with N.
1. Edit or accept the variable definitions as per the following table:

DURATIONIF_M Duration in force in months Defined as Model Point.
MTHS_TO_SALE Months to sale if new business in model point Defined as a formula
INIT_POLS_IF Initial number of policies in force Defined as a model point.
2. On the Design tab in the Variable group click OK. you are returned to the preview tab in the work area.
Miscellaneous variables
Miscellaneous variables have a code starting with O
1. Accept the default definition for the variable in the table.
EC_SCEN_TAB_INNER Economic Scenarios Table for inner
IFRS variables
IFRS variables have a code starting with P
1. Accept the default definition for the variables in the table
RFRE_OTAXIPC Note: Appears in C_ENDT using the Conventional library only.
Tax rate on risk free income
Saving the product

Now that you have created the product, selected the indicators and specified the input variables, you need to save the
product.
To save the product:

1. On the Home tab click Save. The Save Product dialog box appears.
Lesson 1 - Setting up a simple product Additional information 26
2. Click OK to save and close the product.
You can open your product again in the Model Components group in the Explorer pane when you need to.
Additional information
Input variables
To explain the concept of input variables it is useful to look at the definitions of the variable MAT_BEN_PP (maturity benefit
per policy).
3. In the Explorer pane click Libraries and in the tree double-click Conventional or International. A list of variables in
the library is displayed.
4. To select the variable MAT_BEN_PP, type the letters MAT in quick succession in the list, and if necessary scroll down to
MAT_BEN_PP.
Note: If the variables are not displayed in alphabetical order in the work area, click the Name column heading to
rearrange them. You can expand the columns in the list of definitions pane to show more or less of the Indicator
Expression.
In the Conventional Library, there are two definitions, as shown. (In the International library there are five definitions.)
The definition that is brought into a product depends on the combination of indicators selected.
Your chosen combination of indicators brings in the formula definition SUM_ASSD_PP(t), that is the sum assured. This
is the default definition for a non-profit product. Once the formula has been brought into the product you can amend it if
required.
Lesson 1 - Setting up a simple product Additional information 27
Default Indicators
When you select indicators for a product, the following indicators are selected by default:
Indicator Description
ALWAYS Brings in variables that are required in every product. For example, the age at entry and policy
term variables.
PROJ Used to project business that is already in force and new business. It brings into the product
variables that define, for example, the expired duration and currently declared bonus (if the
product is with-profit). If not selected then these variables are not included and only new
business can be projected.
REG_PREM Used if premiums are to be paid regularly (that is the product is not a single premium contract).
ENDOWMENT Used for an endowment type product. If you wish to model a different type of product, then you
would deselect the ENDOWMENT indicator and select a different indicator (for example
WHOLE_LIFE for a whole life contract).
SURR_VALUES Used if a surrender value is payable on early termination of the policy. If not selected, then it is
assumed that no surrender value is paid if the policy lapses (as would be the case for a term
assurance product).
OTAX_ON_I_E The tax indicator selected by default for a new Conventional business product. It is used if the
tax payable by the office is based on a percentage of investment income and realised
chargeable gains less relievable expenses and annuity payments. This is the basis that applies
to life business in the UK.
OTAX_ON_PROF The tax indicator selected by default for new International products. It is used if the tax payable
is calculated as a percentage of gross profit.
ONE_VALBASIS Used if the same valuation basis is applied to the attaching bonus (if with-profits) and paid-up
policies (if specified) as is applied to the basic benefit.
DISC_PROFITS Used if Prophet is needed to calculate the discounted value of future profits. It allows the
discounting to be at three different interest rates.
Variable naming conventions

To make it easier to understand the names of variables, Prophet Professional uses the following naming conventions,
using both suffixes and prefixes in variable names.
Suffix Description
_PC Indicates that the variable takes values entered as a percentage, so 3% would be entered as 3,
for example, VAL_INT_PC.
_M Indicates that the variable takes values entered as months, so 3 years would be entered as 36,
for example, INIT_PER_M.
_Y Indicates that the variable takes values entered as years. For example, POL_TERM_Y.
_PN Indicates that the variable takes values entered as a proportion, for example from a mortality
table, for example, Q_EXP_PN.
_IF Indicates that the variable takes values entered for in force business, for example, NO_POLS_
IF.
_PP Indicates that the variable takes values entered as per policy amounts, for example, MAT_BEN_
PP.
_BASE Indicates that the variable takes values for the base assumptions, for example, RE_FIXED_Y_
BASE.
This table lists some of the more commonly used prefixes. You can examine the variables in a standard library, such as the
Conventional or International library, to identify some other prefixes.
Prefix Description
Q_ Indicates that the variable is a mortality rate variable.
Lesson 1 - Setting up a simple product Lesson summary 28
Prefix Description
IC_ Indicates that the variable is an initial commission variable.
RC_ Indicates that the variable is a renewal commission variable.
VAL_ Indicates that the variable is a value variable, for example VAL_ANN_PREM is the value of
annual premiums.
OTR_ Indicates that the variable is an original term reinsurance variable.
Function syntax
There are some syntax rules and "best practice" guidelines that you should use when editing formulas in Prophet:
n t (time) is entered in lower case type.
n Although excess spaces in formulas are ignored, for readability you should indent the code by two spaces where
appropriate, for example in the lines below IF or ELSE.
Lesson summary
In this lesson you have learned how to use the main features of Prophet Professional to create a new workspace, create a
product and set it up. You have also learned how to select indicators and specify input variables, and how to change the
definition type of input variables. You have seen how Prophet adds secondary input variables when they are referred to in
the Formula Editor as you modify the definition of variables.
Lesson 2 - Setting up model point files and tables 29
Setting up model point files and tables
TOPICS IN THIS CHAPTER
Setting up the model point file 30
Setting up a parameter file 33
Setting up a global file 35
Lesson summary 37
Lesson 2 - Setting up model point files and tables Learning objectives 30
Learning objectives
In the second lesson, you will set up the model point files and tables. Model point files contain the policy data that is used as
a starting point for Prophet's calculations. Each model point can represent an individual policy or a group of policies. In the
latter case each model point contains values that overall represent a tranche of business. Model point files are normally set
up using either the Table Editor in Prophet or the Data Conversion System.
Parameter files contain values for all variables where the same value applies across all the model points of each product,
but for which different values can apply to different products. A good example would be lapse rates, where different types of
product may have different lapse profiles.
Global files contain values for variables where the same value applies across all products and model points in your model
office. A typical example would be the risk discount rate, which you would want to keep the same over the whole company.
For more information about tables see the Prophet Professional User Guide.
1. Setting up the model point file.
2. Setting up a parameter file.
3. Setting up a global file.
Setting up the model point file

First, create the model point file.
1. On the Home tab click the arrow below New and click New Model Point. The New Table dialog box appears.
Model point files are automatically given the file extension of .rpt.
2. In the Table Name box use the default location, but replace model1.rpt with the name of the product that will be using
the model point file, either C_ENDT or I_ENDT.
Note: Do not press Enter when you have typed the new name.
3. To fill the columns with the names of the variables from the product, click Initialise.
Lesson 2 - Setting up model point files and tables Setting up the model point file 31
The Select Products dialog box appears.
4. Select C_ENDT or I_ENDT and then click OK.
The table editor for the new product opens in the work area with the variables you defined in lesson 1 as model points
listed across the top, and the Table tab appears on the Prophet ribbon.
5. Adjust the table properties to give the table a relevant description. On the Table tab click Table Properties.
The Properties dialog box appears.

Lesson 2 - Setting up model point files and tables Setting up the model point file 32
6. In the Description box type a suitable description, in this case type Tutorial Model Point File, and click OK to
return to the table editor.
7. The values of some variables have fixed ranges. For example, the variable SEX can only take the value of 0 (for male)
or 1 (for female). You can choose whether to display the values or their descriptions. For this tutorial you will enter
descriptions rather than values, so on the Table tab on the Prophet ribbon, in the Format group ensure that the Toggle
Constraints option is selected. For more information see Variable Constraints in the Prophet Professional User Guide
or Help.
Tip: You can see the descriptions for the variables as you are editing the table.
n On the Tables tab in the Format group click Names/Descriptions.
The Display of Names and Descriptions dialog box appears.
n In the Variables row click Both, then click OK.
You can now see the descriptions for the variables in the second row of the table.
8. In the table editor, edit the table as per the following table.
Heading Description
SPCODE This is the sub-product code and is used by Prophet when it accumulates the results. Prophet
will automatically sum the results for all of the model points with the same SPCODE. This could
be used for example to make a distinction between the different ways your business is obtained,
for example through direct writing and brokers.
For model office work, set SPCODE to a number between 1 and 50 for in-force business, and to
a number between 51 and 9999 for new business.
The model points must be entered in ascending order of SPCODE in the model point file.
n As you are just going to run one model point for an in-force policy through the product, in this
column type 1.
AGE_AT_ENTRY This is the age of the policyholder at the start of the policy.
n In this column type 30.
SEX n In the list, click Male.
POL_TERM_Y This is the policy term in years.
Lesson 2 - Setting up model point files and tables Setting up a parameter file 33
Heading Description
ANNUAL_PREM This is the annualised premium payable.
PREM_PAYBL_M For this tutorial, this value should be set equal to the policy term multiplied by 12.
(This is not really the recommended way, it is better to define it as a formula in the product
instead of a model point.)
PREM_FREQ This is how frequently the premium is payable.
n In the list click Monthly.
SUM_ASSURED This is the basic sum assured.
DURATIONIF_M This is the duration of time in months that the policy has been in force.
If premiums are paid monthly, then it is the same as the number of premiums which have been
collected. You will assume that the contract was taken out on 1 June 2015, and so 7 months
have elapsed since the contract was taken out.
INIT_POLS_IF This is the initial number of policies in force.
MTHS_TO_SALE This is used for new business in model point method of new business which we are not using in
this tutorial
9. On the Table tab click Save, and in the confirmation message box click OK to accept the filename and location.
10. On the Table tab click Close Table.
Setting up a parameter file

Parameter files are two-dimensional tables which contain constant values indexed by product name and variable name.
Note: The example used in this tutorial does not really emphasise the advantages of using parameter files because you
currently have only one product. In practice you would normally have more than one product and so parameter files
would be used for variables whose values change across products.
1. On the Home tab click the arrow below New and on the list click New Table.
The New Table dialog box appears.
2. Click Parameter and then click Initialise. The Select Products dialog box appears.
3. Select C_ENDT if you are using the Conventional library or I_ENDT if you are using the International library and click
OK.
Lesson 2 - Setting up model point files and tables Setting up a parameter file 34
An empty parameter file opens in the work area with the variables you defined in lesson 1 as parameters listed across
the top, and the Table tab appears on the Prophet ribbon.
4. Enter the following values for these variables:
IE_FIXED_BASE This is the fixed initial expenses.
PROP_EXPQ_PC This is the percentage of the mortality table used for the experience that you wish to use.
PROP_VALQ_PC This is the percentage of the valuation mortality table that you wish to use.
RC_RATE_PC This is the renewal commission rate.
RE_FIXED_Y_BASE This is the current rate of fixed renewal expenses.
VAL_INT_PC This is the valuation interest rate used for calculating the mathematical reserves.
YR1_LAPSE_PC This is the lapse rate assumed to apply for the first policy year.
YR2_LAPSE_PC This is the lapse rate for the second and third policy years.
n In this column type 7.5.
YR3_LAPSE_PC This is the lapse rate for the remaining duration of the policy.
5. To add a description to the newly created table, on the Table tab click Table Properties.
The Properties dialog box appears.
6. In the Description box type a meaningful description: in this case Tutorial Parameter File, and click OK.
7. On the Table tab click Save, or click the arrow below Save and in the list click Save Table As.
The Save As dialog box appears.

Lesson 2 - Setting up model point files and tables Setting up a global file 35
8. In the File Name box change the default name param1.fac to paramet.fac and click OK.
9. Close the table.
Tip: If you cannot remember how to do this, see the last step in the previous lesson, Setting up the model point file.
Setting up a global file

Global files are two-dimensional tables that contain constant values indexed by variable name and by run number.
To create the global file:

1. From the Home tab create a new global table in the same way you created a new parameter file, initialising it from the
Conventional or International product.
Tip: If you cannot remember how to do this, see Setting up a parameter file.
2. Edit the table properties to add the description Tutorial Global File.
3. In the Properties dialog box, Change the value for Number of Run Numbers to 1 and click OK.
Tip: If you see a message warning you that you will lose the last column of data, click OK, as for this tutorial you
only need data for a single run.
4. Include the variables with global definitions for your product:
n On the Table tab in the Update group click Add Variables, in the Select Products dialog box click the Tutorial
Product and click OK.
Lesson 2 - Setting up model point files and tables Setting up a global file 36
The table in the work area looks similar to the following. (This example is from the Conventional product, the
International product only includes one tax variable.)
Tip: When you are using Prophet in practice it is possible to set up the global file to perform multiple sensitivity runs
by adding further columns. To do this, either alter the value for Number of Run Numbers in the Properties dialog
box, or right-click in the table and on the menu click Add Column. New columns have the headings RUN_02, RUN_
03 and so on.
5. Enter the following values for the variables:

CPI_GTH_PC The annual Consumer Price n Set the value to 4.
Index inflation rate.
DISC_A_PC The discount rate that is applied n Set the value to 8.
to the stream of emerging
profits.
DISC_B_PC The discount rate that is applied n Set the value to 6.
profits.
DISC_C_PC The discount rate that is applied n Set the value to 10.
profits.
NP_FII_PC The annual percentage rate of As described in Scenario, this contract is 75% backed with
franked investment income equities which provide franked investment income. These yield
earned on the investments. an average of 3% so the rate is 0.75*3.
n Set the value to 2.25.
NP_RCGCHG_PC The annual percentage rate of The average growth rate of equities (4%) is the same as the
realised chargeable gains. inflation rate (4%) so it is reasonable to assume that all
realised gains will be relieved against indexation allowances.
n Set the value to 0.
Lesson 2 - Setting up model point files and tables Lesson summary 37

NP_RCGUNC_PC The annual percentage rate of As you are assuming that 15% of equities are realised each
realised unchargeable gains. year, the rate is 0.75*4*0.15.
NP_UFII_PC The annual percentage rate of This contract is 25% backed with fixed interest government
unfranked investment income stocks which provide unfranked investment income. On
earned on the investments. average these earn 5% so the rate is 0.25 * 5.
NP_UNRCG_PC This is the annual percentage The rate 0.75 * 4 * 0.85.
rate of unrealised gains. n Set the value to 2.55.
Note: The sum of the above five components of investment return equal to 6.5%. This is equal to (0.75 * 7 + 0.25 *
5), the overall return specified in Lesson 1.
6. For the Conventional library product, enter the following tax values:

OTAX_FII_PC The annual percentage tax rate on franked investment income. n Set the value to
20.
OTAX_RCHG_PC The annual percentage tax rate on realised chargeable gains. n Set the value to
25.
OTAX_UFII_PC The annual percentage tax rate on unfranked investment income. n Set the value to
25.
For the International library product, enter the following one tax value:

OTAX_PROF_PC The annual percentage tax rate on profits. n Set the value to 33.
7. For both products enter the following value:

SOLV_INT_PC The interest rate on the solvency margin. n Set the value to 5.
Tip: You can add further columns and rows to your tables, as required. For more details, see Setting up tables in the
Prophet Professional User Guide.
8. Save the table with the name GLOBAL.FAC to the default location, then close the table.
Tip: If you cannot remember how to do this, see the final steps of Setting up a parameter file.
Lesson summary
In this lesson you have set up model point files and tables, including parameter and global files. You have learned how to
create new tables of different types.
Lesson 3 - Setting up, running and reporting on a product 38
Setting up, running and reporting on a product
TOPICS IN THIS LESSON
Setting up a structure 39
Setting up a run setting 40
Running the product 48
Viewing results produced in a run 51
Lesson summary 54
Lesson 3 - Setting up, running and reporting on a product Learning objectives 39
Learning objectives
In this lesson you will set up a run structure and a run setting, run the product, identify and resolve an error and then view
the results. You will also learn how to print results.
The run setting determines how you want to run the structure that you set up in the previous lesson. When you run the
product you define which structure and which run setting you want to use, also known as a run pairing.
1. Setting up a structure.
2. Setting up a run setting.
3. Running the product.
4. Viewing results produced in a run.
5. Printing results.
Setting up a structure
Before you can start a run you need to create a structure, to include the Tutorial product that you set up in Lesson 1.
1. To do this, on the Home tab in the Edit group click the arrow below New then click New Structure.
The Structure dialog box appears, with the Model Components tab displayed.
2. In the Name box, type Tutorial Structure, then click Select Products.
Lesson 3 - Setting up, running and reporting on a product Setting up a run setting 40
The Select Products dialog box appears.
The Available Products list contains all the products which can be selected, the Selected Products list contains all
the products which have been selected.
3. In the Available Products list, either click C_ENDT (or I_ENDT) and click the right arrow, double-click it, or click and
drag it to the Selected Products list.
Tip: Tip: This dialog box uses a standard format that you will see throughout Prophet.
You can move items from one list to another by selecting items and using the arrows between the lists, double-
clicking the item, or by clicking and dragging.
4. To add the selected product to the Products list in the Structure dialog box, click OK. The Select Products dialog box
closes and you are returned to the Structure dialog box.
Note: This tutorial does not use accumulations, which allow results from one or more products to be aggregated
together, or structure links, which are part of the Nested Structures module. You can learn about accumulations in
the Model Office Tutorial, and about structure links in the Nested Structures User Guide.
5. As you do not need to edit any settings on the Configuration tab, click OK to close the Structure dialog box.
You can access the tutorial structure in the Explorer pane in the Run Control section.
You have now completed objective 1 of this lesson.
Setting up a run setting

Setting up a run involves specifying a structure and a run setting. Structures contain information about what you want to run
and run settings contain information about how you want to run it. You can set up and maintain a number of different
structures and run settings so that you switch between them rather than amending them. You have already set up a
structure, so you now need to create a run setting.
1. On the Home tab click the arrow below New and click New Run Setting. The Select Run Setting Type dialog box
appears.
Note: If you are returning to the tutorial after a break, on the Start page open the Tutorial workspace, then in the
Explorer pane in the Run Control pane, double-click the run setting to open it in the work area.
2. Click Calculation Run and then click OK. The Run Setting - Calculation Run dialog box appears.
The dialog box contains five tabs.
3. In the Name box type Tutorial Run Setting and leave both the Stochastic and Dynamic check boxes clear.
4. The Run Parameters tab allows you to specify the start date and the future and past accumulation periods. In the
General section complete the settings as follows:
Option Description Action

Start Date Allows you to specify the start date of the model The projection for the current run is to be
office projection. based at 31 December 2021, as mentioned in
Scenario.
n Change the value to 31 December 2021.
n Click the down arrow at the end of the box

to display a calendar, scroll to December
2021 and click 31.
Tip: Tip: To change just the year of the

date, click the date and on your keyboard
press the up or down arrow to increase or
decrease the year. This also applies to the
month and day.
Month in which Used to ensure that reporting by company year n Accept the default of 12.
Company Year Ends is handled correctly within Prophet.
Option Description Action

Future Accumulation The number of years of projected results that will You are projecting in-force policies with a ten
Period be included in the results files produced by year policy term and wish to be able to view
Prophet. The actual calculations are always the results of all the calculations.
made from the start of the policy until at least the n Set the value to 10.
end of the policy term, to ensure that items such
as the discounted value of future profits are Note: If you were projecting new business
properly calculated. policies for one year, you would enter 11,
rather than 10, because for a 10-year
policy, the maturity proceeds are paid out
in the first month of the 11th year. Thus, if
the policy was issued in June 2022 the
proceeds are paid out in June 2032.
Past Accumulation The number of years of results prior to the start n Leave the default value unchanged, with a
Period date of the projection that will be included in the value of 0.
results files produced by Prophet. It primarily
enables you to produce output for checking
historic asset share calculations.
The other options in this tab are not needed in the run, so you can leave them as they are.
Tip: Tip: If you want to investigate the other options further, you may like to work through the Model Office Tutorial
when you have finished this tutorial.
You can also expand the Advanced - Batch Programs section to see further options that allow additional programs to
be specified that can be run at specific points in a run, but for this tutorial you are not running batch programs.
5. Click the Tables tab.

The Tables tab appears similar to the following:
The Tables tab contains options that specify the following settings:
n The location and file extension of the model point files for the structure.
n The locations and names of the global, parameter and prices files.
n The location of any other tables.
n The location and name of the sales file which contains assumptions about future new business volumes.
n The location of any 'table of tables' you have set up.
Note: Unless you specify the complete location including the drive letter or UNC path, any location you enter is
taken relative to the workspace location.
The default location for the model point files is MPFILES, which means that, if you have installed the tutorial on the C:
drive and in the location Prophet_Tutorial, then the model point files will be read from C:\Prophet_Tutorial\MPFILES.
The default location for all the other files is the TABLES location and is handled similarly.
n This tutorial uses the default locations and names and does not use a unit prices file or a sales file, so in the Sales
File box delete the default entry, and ensure that the Unit Prices File and Table of Tables boxes are also empty.
6. Click the Results tab. This tab enables you to specify what kind of output is to be generated in the run and the
format(s) in which it is to be produced.
The Results tab appears similar to the following:
7. In the Standard Files section complete the settings as follows.
Item Description Action

Results Files Allows you to choose You can select any of the following options:
the type of results files n NB Profile: These results contain projected results for each month
that will be produced of the future and past accumulation periods.
in Prophet's own
n Valuation: These results contain the values calculated at the start of
results file format.
the projection period split by maturity year or current age.
n Accumulation Results: Produces and retains the results generated

by accumulations.
Select the Projection / NB Profile check box and clear all the others.
Item Description Action

Variables in Results Allows you to choose You can select one of the following options:
Files the variables to be n All: Results contain values for all the variables in the product. This is
retained in the results. most useful when you are developing products and testing that they
perform the calculations you require.
n Cumulative: Results contain values for all the variables with the
cumulative property check box selected. This is normally all
variables for which it makes sense to sum values across model
points. If the cumulative property of a variable is checked, its values
are also aggregated across products if accumulations are being
used.
n Selected: Results are generated containing values for the variables

in a selected variable group. You select the variable group by
clicking Variable Group and then selecting the group from a
category.
Note: Variables which are defined as, or which evaluate to, constant
values are always included in the results files. This includes all
variables defined using either global or parameter definitions. In
addition, the values for the first model point of each sub-product
code are included for all variables defined as model point.
Select All so that you can inspect the values of all the variables in your
product.
Product Total Results Allow you to specify This can improve run times and reduce unnecessary disk space as
Files (00) which Product Total unwanted results files are not created.
Results files can be n Accept the default setting to create results files for both sub-product
suppressed. codes and product totals.
8. Expand the Individual Model Point Files section.
You can specify whether output files are to be generated which contain a line of results for each model point. If selected,
individual model point results are produced in Prophet’s model point file format. These files contain the values at the
projection start date (that is, at t = DUR_M) for each of the variables in the specified variable group.
Tip: Tip: For more information on variable groups see Managing Variable Groups in the Prophet Professional User
Guide or Help file.
n For this tutorial leave all these check boxes clear.

9. Expand the Advanced Results Settings section.
This section allows you to define how files are deleted and created during a run and what results are retained in
memory.
n For this tutorial leave all check boxes clear.

10. Expand the Additional Files section.
This section allows you to save results in a text format instead of in Prophet's own results format, which can then be
used in other applications. It also allows you to retain the intermediate results generated in dynamic runs and debug
dynamic runs.
n For this tutorial leave all check boxes clear.
11. Click the Runtime Configuration tab. This tab allows you to specify how it is to be split among other PCs when
Parallel PC mode is used, the type of run and how errors are handled.
The Runtime Configuration tab appears similar to the following:
For this tutorial you will perform the run on your local machine, so do not make any changes.
12. Expand the Error Control section.
This section allows you to specify the maximum number of errors allowed before Prophet terminates the calculations for
a particular product and the maximum number of warnings before termination of an accumulation. The default is zero,
which means that the calculations for a product is terminated if or when the first error occurs. If you enter 10, a product is
be terminated when the 11th error occurs. If you select the No Limit check boxes, Prophet continues the calculations
irrespective of the number of errors that occur.
The model point file you are using for this product contains only one model point, so you only want results if no errors
occur.
n Do not make any changes to this section.

13. Expand the Type Of Run section.
This section allows you to specify a complete run or a partial run.

14. Expand the Advanced Runtime Configuration section.
Lesson 3 - Setting up, running and reporting on a product Running the product 48
This section allows you to specify the order in which products are run and the seed values to be used for stochastic
runs.

15. When you have entered all the required settings, in the dialog box click OK to save the run setting.
You have now completed the second objective for this lesson. Next you will run the product.
Running the product

When you run the product, Prophet checks that all the model point files exist for the products included in the run and that
the global and parameter files specified in the structure exist. It then carries out the variable sequencing, code generation
and compiling processes needed to generate an executable program, carries out the calculations for the model points and
creates a file of the sub-product results for the required variables over the specified period of accumulation. During this
process Prophet displays progress messages and, if there are any errors, displays error messages and suggests how you
can fix the problem. Any run messages are saved to a log file.
In Lesson 1 you deliberately incorporated an error in a formula, so in this lesson you will run the product and be alerted to
the error, then fix the error and re-run the product.
1. In the Explorer pane click the newly created run setting or the Tutorial structure, and on the Home tab in the Run group
click Run.
The Select Run Pairings to be Run dialog box appears.

This dialog box displays some of the run settings that you defined in the previous lesson and allows you to select a run
pairing, if you have created more than one. For this tutorial you have only created one pairing, but in practice you may
create several.
2. In the Run Control group, for this tutorial ensure the Show Hints check box is clear, then click OK.
Prophet first carries out various checks such as ensuring that all the model point files exist for the products included in
the run and that the global and parameter files specified in the structure exist.
After a few moments, the Run Monitor dialog box appears.
As the run proceeds, Prophet identifies the error that you introduced in Lesson 1, and the Run Monitor appears as
follows:
3. Click Run Log. A separate Results Viewer window appears.
4. In the Results Viewer window, beside the summary click View.
The Results Viewer window contains a tree with the sections of the runlog and a scrollable list containing several
sections that you can expand and collapse.
To navigate the results you can use the scroll bar, expand or collapse the sections or click items in the tree structure.
5. Scroll to the bottom of the list to the Errors and Warnings section. You can see that there are three errors in
Execution.
Lesson 3 - Setting up, running and reporting on a product Viewing results produced in a run 51
6. In the tree structure expand the Execution folder if necessary, then click the product that you ran. The work area in the
Results Viewer contains the following information:
You can see from the error message that there is a problem with variable SURR_VAL_PP in product C_ENDT. (If you
are using the international library the error will be in product I_ENDT.)
To correct the error you need to edit SURR_VAL_PP.
7. Close the Run Monitor and Results Viewer windows.
8. In the Explorer pane open the product, and then double-click SURR_VAL_PP to open it in the work area.
Tip: Tip: To find the variable easily, in the work area sort by Code and scroll to ED10, or sort by name and scroll to
the variable.
Taking a look at SURR_VAL_PP, you can see that the first part of the formula refers to itself at time (t-1). It is a
"recursive" formula which is necessarily evaluated by starting at t = 0 and moving forward one month at a time.
However, at time period 0 (when the error occurred) this formula will reference the value at t = -1. As t can only take
positive values, this term has caused the error.
9. To rectify the error, replace the first line with the following:
IF t = 0 THEN
0
ELSE IF t <= 23 THEN
10. On the Design tab click OK, then save your product.
11. Re-run the product, then examine the run log, as described above. You can see that there are now no errors.
You have now completed the third objective of this lesson.
Viewing results produced in a run

When a run is completed the results are stored on the hard disk, in the Results folder in the workspace location.
To view the results:

1. In the Explorer pane, expand Results to view the available results. As you have performed just one run, there is only
one.
2. Expand RunNumber: 1 to see the available types of results.
Results types can be used to specify the type of results you want to view.
1. In the Results pane expand the Projection folder.
2. Double-click C_ENDT#1.proj (or I_ENDT#1.proj) in the tree to display the following screen:
From here, you can use the Analyse and Format tabs to filter and explore the selected results.
Variable Groups
On the Analyse tab, the Filter group includes two lists - Variable Category and Variable Group. These lists reflect the
categories and groups of the variables in the Select Variables dialog box which you used to set up the product, as well as
additional options in the Variable Category list that allow you to select All Variables or Cumulative Variables.
1. In the Variable Category and Variable Group lists, change the selections and watch the results in the work area. The
results on the screen change to reflect the new selections.
2. Change the Variable Category back to A - Revenue Accounts - Liab Libraries.
3. Change the Variable Group back to A10 - Revenue Account / Profit Test.
Time Periods
1. On the Format tab, in the Results group click Time Periods. The Time Periods dialog box appears.
The settings in this dialog box allow you to define the time periods for which you want to display results. You can choose
to display your results monthly, quarterly, half-yearly, annually and/or 5-yearly for a specified number of years or to the
end of results.
2. Complete the Time Periods dialog box as follows:
n In the Start Position group, click Start of Results.
n In the Format group click Company Year.
n In the Number of Years column, in the Monthly row enter 1. This will display one year of monthly results.
n In the To End of Results column, select the check box in the Annually row. This displays annual results to the end
of the results.
n Select the Show Annual Summary check box.

3. Click OK.
Viewing results
The remaining body of the results window displays the results. It is divided into two tabbed sections:
n Values (for time-dependent variables)
n Constants (and other non time-dependent variables)
You can also choose to display either the variables or the time periods as the columns.
To switch between them click Swap in the corner of the grid of values.
n Set the display so that the variables are in columns and the time periods are in rows.
Copying Results
If you want to copy results, for example to Microsoft Excel or Word, right-click in the results and on the menu click one of the
following options:
Option Description
Copy This option copies a selected range of cells. You can also do this from the Clipboard group of
the Home tab on the ribbon.
Lesson 3 - Setting up, running and reporting on a product Lesson summary 54
Option Description
Copy Grid This copies the entire grid of values including the top and left borders to the Windows clipboard.
You can also do this from the General group of the Results tab of the ribbon.
Copy Grid to Excel This copies the entire grid to Excel. You can also do this from the General group of the Results
tab of the ribbon.
Printing results
If required, you can also print the results from a run.
To print results:
1. Click the File tab and on the Backstage view click Print.
The Print Results dialog box appears.
2. Select the Grid Values and Constant Values check boxes and click OK.
Lesson summary
In this lesson you have set up a run structure and a run setting and run the product. You have also identified an error and
resolved it, and then viewed and printed the results.
Lesson 4 - Reporting on dependencies in Diagram View 55
Reporting on dependencies in Diagram View
Opening Results Diagram View 56
Viewing variable dependencies 58
Filtering views 59
Identifying changes required for enhancements 60
Lesson summary 62
Lesson 4 - Reporting on dependencies in Diagram View Learning objectives 56
Learning objectives
In this lesson you will learn how to use Results Diagram View to examine the results of your run.
Results Diagram View allows you to view all the variables and formulas in a product, the dependencies between the
variables and their values.
1. Opening Results Diagram View.
2. Adjusting the view in Results Diagram View.
3. Viewing variable dependencies.
4. Filtering views.
5. Identifying changes required for enhancements.
Opening Results Diagram View

Results Diagram View allows you to examine results of a Prophet run in a range of graphical views. You can see the
variable dependencies within the product, review variable definitions and supporting actuarial documentation and view
results values.
To open Results Diagram view:

1. In the Explorer pane, open and expand the Results pane and select the product you have run.
If using the conventional library this is C_ENDT#1.proj, if using the international library this is I_ENDT#1.proj.
2. Right-click the projection name, on the menu point to Open then click Open Results Diagram View.
OR
On the Home tab click the arrow below Open and on the menu click Open Results Diagram.
Lesson 4 - Reporting on dependencies in Diagram View Opening Results Diagram View 57
The Analyse and Format tabs appear on the ribbon and the Results Diagram View appears in the work area.
You have completed the first objective for this lesson.
Adjusting the view in Results Diagram View

You can change the way in which the information is displayed, either from the Format tab of the ribbon or from the
Diagram Options tab of the Options dialog box.
n On the Format tab there are several options that allow you to change the display settings for the font, number, names
and to specify which time periods to display the results for.
n To hide variables which have zero values, on the Format tab click Suppress Zeros.
n To show or hide the dependency trees, on the Format tab click Dependency Trees.
n To move backwards and forwards through a history of the variables that you have selected as the current variable, on
the Analyse tab click Back or Forward.
n To display other options for Results Diagram View, on the Format tab click Diagram Options.
OR
Click File and on the backstage view click Options. The Options dialog box appears. In the list click Customize GUI,
then click the Diagram Options tab.
n To specify which types of variables are highlighted and in which colours, select the check boxes for the variable
types and select the required colours.
n To specify whether the three results panes are synchronised or you can scroll each one independently, select or
clear the Synchronize results panes check box.
You should now spend some time moving through the variables in the product you have created, exploring the
dependencies between them, and adjusting some of the options.
Lesson 4 - Reporting on dependencies in Diagram View Viewing variable dependencies 58
Viewing variable dependencies

The Results Diagram View pane appears in the main work area when you are using Results Diagram View. It is divided
horizontally into three groups of panes:
n Variable dependencies
n Variable definition
n Results values
You can adjust the size of any pane by dragging its borders.
Variable dependencies
The left pane shows all the visible precedents, direct or otherwise, of the current variable - that is, the complete list of
variables on which the current variable depends.
The centre pane of the top section shows the direct relationships between the current variable (in this case, MATH_RES_
IF) and other variables in the product. The current variable is also displayed in the Variable list in the Analyse tab of the
ribbon.
The right pane shows all the visible dependents of the current variable - that is, the complete list of variables which depend
on the current variable.
Variable definition
The middle section displays the name, description, type, variable code and definition of the current variable, and any
associated actuarial or formula block documentation. For non time-dependent variables, the value is also displayed in this
section. In the case of model point variables and other non time-dependent variables that have values that vary between
model points, the value for the first model point of the current sub-product is displayed.
Tip: If you move the mouse pointer over any variable name in the top section, the middle section displays information
about that variable instead of the current one.
Lesson 4 - Reporting on dependencies in Diagram View Filtering views 59
Results values
The three panes in the bottom section show the values of time-dependent variables in your product.
n The left pane shows the values of the variables on which the current variable depends.
n The centre pane shows the values of the current variable.
n The right pane shows the values of the variables that depend on the current variable.
Filtering views
You can change how you view variable dependencies in several ways:
n To expand the tree structure in the left or right panes, click the + sign beside a variable that has precedents (in the left
pane) or dependents (in the right pane).
n To make any variable in the product the current variable, either click the variable in the centre pane, or on the Analyse
tab in the Variable list select the required variable.
Tip: If you type in the first few letters of its name in quick succession, the first variable starting with those letters is
highlighted.
You can use the filters in the top left and top right panes to filter the precedents and dependents of the diagram in order to
focus on the path you are interested in.
For this exercise, you will look at which variables that feed into the PROFIT variable are influenced by mathematical
reserve (C_MATHRES_IF).
1. Change the current variable to PROFIT.
On the Analyse tab of the ribbon, in the Variable list select PROFIT.
The left pane now shows PROFIT as the current variable and the centre pane shows the precedents and dependents of
PROFIT.
2. In the left pane expand the PROFIT and GROSS_PROFIT variables. GROSS_PROFIT contains 14 variables in the
conventional product, 17 in the international product.
Lesson 4 - Reporting on dependencies in Diagram View Identifying changes required for enhancements 60
3. In the left pane change the FILTER BY PRECEDENT to C_MATHRES_IF and expand PROFIT and GROSS_PROFIT.
Note that GROSS_PROFIT now only shows 4 child variables.
Only the variables that are derived, either directly or indirectly, from C_MATHRES_IF are displayed. As you further
expand the tree, C_MATHRES_IF can be seen at the end of each branch.
Identifying changes required for enhancements

You can use Results Diagram View to help you clarify which variables need to be changed when making enhancements to
a product. You will make the required changes in the next lesson.
The required enhancements are:
n Use different valuation interest rates depending on the valuation series to which each model point belongs.
n Assign different mortality rates to males and females.
The first stage in this process is to identify the variables that need to be changed in the product.
1. From the Analyse tab of the ribbon, make VAL_INT_PC the current variable.
Tip: Use the Variable list to select the required variable.
The top section of the work area now looks like this:
When you look at its dependencies you can see that VAL_INT_PC is only used in the variable M_VAL_INT, which in
turn is only used in the valuation commutation functions, so VAL_INT_PC is the variable that needs to be edited.
2. For the second enhancement you want to change the experience mortality to depend on sex. You can use the tree to
identify the correct variable.
In the Explorer pane in the Model Components pane, expand the details of the product C_ENDT.
Lesson 4 - Reporting on dependencies in Diagram View Identifying changes required for enhancements 61
The product expands, and shows which library it was created from. In this case Conventional.
You can also expand the model point files associated with the product, the indicators, the variable definitions and the
results.
3. Expand Input Variable Definitions. This gives you the full list of input variables in the product.
4. Right-click Input Variable Definitions, on the menu point to Group By and then click Variable Main Category.
The definitions are now grouped by category in a similar way to when you were defining the variables.
5. Expand the K-Mortality group.
Referring to the product listing you produced earlier, you will see the input variables for mortality in the section headed
K-Mortality.
6. Hover over the variables in this category. The tool tip for Q_EXP_PN is Experience Mortality Rates; this is the variable
we want to change.
7. In Results Diagram View, select Q_EXP_PN.
You can see that the mortality rates on the experience basis are only used in the variable Q_EXP_BASE. This means
that amending Q_EXP_PN will have no wider, unintended effects.
There are already variables set up in the library to distinguish between male and female mortality experience. These
are:
Q_EXP_MALE KA11
Q_EXP_FEMALE KA12
Lesson 4 - Reporting on dependencies in Diagram View Lesson summary 62
The best way to make the change is to define Q_EXP_PN as a formula which picks out the correct mortality table
dependent on the policyholder's sex using these two variables. You will do this in the next lesson.
8. On the Home tab click Close to close Results Diagram View.
Lesson summary
In this lesson you have examined the interface of Results Diagram View and learned how to customise it and used the
graphical representation and filtering to identify the effects of variables on other variables. You have also used it to identify
which variables you need to change in order to implement some enhancements to the product.
Lesson 5 - Updating libraries and products 63
Updating libraries and products
Adding a new variable to the library 64
Updating the product 67
Viewing scenarios that show the effects of product changes 75
Identifying an error in the run 77
Lesson summary 78
Conclusion 78
Lesson 5 - Updating libraries and products Learning objectives 64
Learning objectives
In this lesson you will add a new variable to the library so that you can make the enhancements discussed in the previous
lesson. The required enhancements are:
n Use different valuation interest rates depending on the valuation series to which each model point belongs.
n Assign different mortality rates to males and females.
You will use the Formula Wizard to edit formulas, and Product Design View to examine the relationship between variables.
1. Adding a new variable to the library.
2. Updating the product.
3. Viewing scenarios that show the effects of product changes.
4. Identifying an error in the run.
Adding a new variable to the library

You are now going to add a new variable, VALN_SERIES, to the library. The variable will be used when defining the
valuation interest rates depending on the valuation series to which each model point belongs.
1. In the Explorer pane click Model Components, expand the product you have created and double-click the library to
open it.
Lesson 5 - Updating libraries and products Adding a new variable to the library 65
2. As you want to add a new variable to the library, on the Home tab click the arrow below New and on the menu click New
Variable.
The Variable Properties dialog box appears.
3. In the Name box type VALN_SERIES.
4. Leave the Type as Number.
5. Complete the Workspace Level Properties section of the dialog box according to the following table.
Option Action Description

Description Type Valuation
Series.
Accounting Type Click Balance Sheet. Revenue Account means that annual values for this variable will be
the sum of the twelve monthly values (for example Premium
Income).
Balance Sheet means the annual values for this variable will be the
values in the last month of the year (for example Mathematical
Reserve In Force, MATHRES_IF).
Default Printed Enter 0. The normal Prophet convention is to use two decimal places for
Decimal Places monetary values and six decimal places for actuarial functions,
interest rates and so on. However, this variable does not need
decimal places.
Lesson 5 - Updating libraries and products Adding a new variable to the library 66

Constraints Leave this entry blank as You can specify the values that a variable can have by setting up a
we will not be applying any constraint condition. The constraint that you specify is then used to
constraints to the variable. validate the values that you enter for the variable in the Table Editor.
The constraints that can be specified for the variable can be one of
the following:
n Specified values constraint: This type of constraint allows you
to specify the values that the variable can have, together with
descriptions for each such value.
n Min / max / integer constraint: This type of constraint allows

you to specify the minimum and maximum values that the
variable can have, and also whether it can only have integer
values.
n Enumeration: This type of constraint allows you to restrict the

values to the values defined in a selected enumeration.
n SCENARIO_LIST: This type of constraint allows you to restrict

the values to scenarios as defined in the workspace.
For further details on Enumerations and Scenarios please see the Prophet Professional User Guide
As the remaining workspace level properties are beyond the scope of this tutorial, leave the other check boxes in the
Workspace Level Properties group clear.
6. Complete the Library Level Properties section of the dialog box according to the following table.

Type Click Input. Type allows you to choose between input and core variables.
n Input variables are used to define the specific calculations you want to
make for each of your products. When you specify a new product,
Prophet presents you with a list of input variables to be defined, based
on the indicators you select.
n Core variables contain the calculations which do not vary by product.

Prophet automatically includes the appropriate core variables with their
appropriate definition, based on the indicators you select for that
product.
Variable Code Click Browse and This is a four-character code which controls the order in which the input
search through the variables are presented when setting up a product. It consists of two letters
variables to find the followed by two digits. Any number of variables can be given the same
variable code for variable code but it is better to give them different codes so that they
VAL_INT_PC, appear in the order you want. The natural place for VALN_SERIES to
which is FA10. appear would be just after VAL_INT_PC (the valuation interest rate).
To assign the next
variable code,
double-click VAL_
INT_PC. VALN_
SERIES now has a
variable code of
FA11.
7. Click OK to close the Variable Properties dialog box.
The variable VALN_SERIES is highlighted in the list of variables. From here you can create and amend the definitions that
already exist for the variable and change it or create a new one. In this case there are no definitions because you have just
created this variable.
Lesson 5 - Updating libraries and products Updating the product 67
Creating a new model point definition

The variable you have just created needs to be assigned a definition.
1. In the main work area, right-click VALN_SERIES and on the menu click New Variable Definition. The Definition Type
dialog box appears.
2. Click Model Point and then click OK to close the dialog box.
The main work area contains a screen similar to when you specified the product, but the bottom part of the screen now
contains a section titled Indicator Expression.
Note: When creating your own products you will be able to specify the indicator or the specific combination of
indicators that would bring the variable into a product, but for this tutorial you do not need to add an indicator
expression. For further information, see Libraries in the Prophet Professional User Guide or Help.
3. On the Design tab in the Variable group click OK.
The model point definition screen closes and you are returned to the definitions window, but instead of it being empty
you can see the definition you have created, which means that you have finished creating the variable, which will only
be brought into the product when it is referred to by another input variable.
4. Close the library tab.
Updating the product

You will now update the product to include the enhancements described in the previous lesson. You will also create a table
of initial commission rates and amend the product to read values from this table rather than using the existing formula.
First, you need to update the variable definition that determines mortality rates, because you want to distinguish between
male and female.
1. Double-click the product to open it.
Tip: In the Explorer pane you can see the product in the Model Components pane.
The following dialog box appears.
You should normally select Yes when this dialog is displayed. Prophet then scans all the input variables in the library to
check if any need to be added or removed from the product. This ensures that your product reflects any changes you
have made to variables in the library. In this case, clicking Yes or No has the same effect since your new variable has a
blank indicator expression and hence will not be brought into the product until it is referred to by another variable.
2. Click Yes.
Prophet scans the input variables in the library and then lists them in the main work area.
3. Select Q_EXP_PN (code KA10). This is the variable definition for Experience Mortality Rates, which you want to adjust
depending on the whether the policyholder is male or female.
Tip: To find variables easily, you can sort the variables according to the headings. Click the Code heading to sort by
variable code.
You could double-click the definition to open it, or on the Home tab click Open, but for the purpose of this tutorial you
will edit it in Product Diagram View.
4. On the Home tab in the List View group click Diagram. The following screen appears.
5. Change the definition type to Formula.
In the main work area, in the top left pane or the top centre pane, right-click Q_EXP_PN, on the menu point to Change
Definition Type to and click Formula.
Tip: Another way to change the definition type is to open the definition and on the Design tab click Change
Definition Type, as you did in Lesson 1.
The definition opens in the main work area.
6. Add the following formula to the definition:
IF SEX = 0 THEN
Q_EXP_MALE
ELSE IF SEX = 1 THEN
Q_EXP_FEMALE
ELSE
ERROR("Invalid value entered for variable SEX")
Note: The ERROR function in the last line of this formula will cause a run error if an invalid value has been entered
for the variable SEX. The text inside the quotation marks will appear in the run log. Note that there is a similar
function called WARNING, which allows the run to continue but produces a warning message in the run log.
7. Accept the formula, then open Q_EXP_MALE.
Tip: You could click OK on the Design tab to close the definition, then open Q_EXP_MALE. However, if you sorted
the variable definitions by code in step 3 above, on the Design tab click Next to accept the new definition and open
the next definition in the list.
8. Click Next to accept the default definition for Q_EXP_MALE and open Q_EXP_FEMALE.
9. On the Design tab click OK to accept the default definition for Q_EXP_FEMALE and return to Product Diagram View.
The dependencies view for Q_EXP_PN have been updated to show the new dependencies. You can expand the list of
precedents in the top left pane to also show the tables and mortality points linked to the precedents:
Using the new formula, both male and female mortality tables are loaded into memory at the start of a run and the
appropriate values (based on age at entry) are then read into the Q_EXP_MALE and Q_EXP_FEMALE variables.
However, only one of these variables will be used as the experience mortality for any one model point, depending on the
value of the variable SEX.
You can enhance the formula for Q_EXP_PN to demonstrate the use of the function READ_MORT_TABLE. It uses only
one variable (SEX) rather than three (SEX, Q_EXP_MALE and Q_EXP_FEMALE). The function READ_MORT_TABLE
has the same parameters as those that must be specified if a variable is defined as a mortality table. These are the name of
the mortality table, the age at entry variable, select or ultimate setting and age rating.
You will edit the formula and use the Formula Wizard to do so. The Formula Wizard can be a useful way to enter formulas in
several areas of Prophet.
1. Open Q_EXP_PN and delete the formula from the second line onwards, leaving just the first line.
IF SEX = 0 THEN
2. With your cursor on the second line, press Shift-F3, or on the Design tab in the Formula Editing group, click the arrow
below Insert and click Function.
The Prophet Function Wizard appears.
You will use the Function Wizard to enter the rest of the formula:
IF SEX = 0 THEN
READ_MORT_TABLE("AM92", AGE_AT_ENTRY, "S", 0)
ELSE IF SEX = 1 THEN
READ_MORT_TABLE("AF92", AGE_AT_ENTRY, "S", 0)
ELSE
ERROR("Invalid value entered for variable SEX")
Note: International library users should use GKM80 and GKF80 respectively instead of AM92 and AF92.
3. In the Function Category list click Read, then in the Function Name list click READ_MORT_TABLE.
4. Click Next. The second step of the Function wizard appears.
5. Enter the arguments required for the function:
Note: Ensure that you include the quote marks as shown in the formula.
6. Click Finish. The function is entered into the formula.
7. Add the rest of the formula, either by typing or using the Formula Wizard.
8. On the Design tab click OK to return to Product Diagram View. Notice that the dependencies have been updated.
This formula does not reference the Q_EXP_MALE and Q_EXP_FEMALE variables so they are not required in the
product. Because you typed in the first suggested approach before switching to the second method, the variables will
still be included in the product.
Note: You can switch between Product Diagram View and the original list of variables using the Details, Diagram
and List icons on the Home tab. This can be useful because you can use the outline to help you select the variable
you want to look at. Prophet remembers which variable is selected when you move between the views in this way.
When you do this, the list of variables will include the core variables as well as the input variables. However, you
cannot edit the core variables from either of the views. This can only be done from within the library.
9. Switch to Details view. You will notice that Q_EXP_MALE and Q_EXP_FEMALE are still in the list.
10. To remove them from the product, on the Object tab click Re-Scan.
Valuation series
You have set up the variable VALN_SERIES in the library with a default definition of model point. You will now amend the
product so that if this variable takes the value 0, the policy forms part of the old series, and if it takes the value 1, it will form
part of the new series.
To do this, you need to change the variable VAL_INT_PC.
1. Open variable VAL_INT_PC.
2. Change the definition type to Formula.
3. Enter the following formula:
IF VALN_SERIES = 0 THEN
2.75
ELSE IF VALN_SERIES = 1 THEN
3.0
ELSE
ERROR("Invalid value entered for variable VALN_SERIES")
4. On the Design tab click OK to accept the formula.
5. View VALN_SERIES in Product Diagram View. You can see that VALN_SERIES is shown as being used by VAL_INT_
PC. It has been brought into the product as a result of your referencing it in VAL_INT_PC.
6. When you created it you gave VALN_SERIES a model point default definition in the library. To accept this definition
open the variable and on the Design tab click OK.
Defining the initial commission rate

The scale used for initial commission rates at the moment is fairly simple, and can easily be entered as a formula. In
practice, however, the scale will usually be more complicated and so you will now replace the formula with a generic table.
Generic tables are in a format which can be used for many different purposes.
When you initially set up the product you entered a formula for the variable IC_RATE_PC (Initial Commission Rate), but
now you will change it to have a generic table definition.
1. The definition type for the variable IC_RATE_PC is currently defined as a formula but you need to change it to a
Generic Table. The Generic Table Definition is shown in the main work area.
2. Edit the table definition as follows:

Table Name / Variable Click Table Name This is the name of the table which Prophet uses when finding the required
containing Table and in the box type values for the variable. You can select whether to specify the table name
Name INIT_COM. directly or read it from another variable.
For this tutorial you will only use one table, but in practice when creating
more complex products you may want to create a variable.
Time Allocation Click Annually. You can choose either Monthly or Annually to determine how often the
table is accessed.
In this tutorial it will only be accessed once for each model point because
the value for this variable does not vary with time. Prophet allows for this
automatically.
Treat Missing Value as Ensure this check If you clear this check box, Prophet uses a value of zero for missing values.
Error box is selected.
3. To enter the index variable names you can type the name directly in the box, use the arrow at the end of the box to
select from a list, or click the Insert Variable button. The main differences between the two lists are:
n The drop down list includes special names such as VAR_NAME and PROD_NAME which can only be used as index
variables. These aren't included in the Insert Variable list because they are not true variables.
n The Insert Variable list shows the descriptions for each variable whereas the drop down list only shows the names.
Edit the index variables as follows:
Index Variable Action Description

1 Set to POL_ This variable defines what the initial commission rate depends on.
TERM_Y.
2 Set to VAR_ Prophet will use the values in the column headed IC_RATE_PC in the generic
NAME. table because this is the name of the current variable.
Tip: When selecting from a list, type the first few letters of the name to jump to names that start with those letters.
The definition looks like this:

4. On the Design tab click OK to accept the definition.
As an alternative to defining the variable IC_RATE_PC as a generic table, you could have used the READ_GENERIC_
TABLE function. If you had done this, you would have used the following formula:
READ_GENERIC_TABLE("INIT_COM","Y",POL_TERM_Y,"VAR_NAME")
where the terms inside the brackets correspond to the entries "Table Name", "Treat Missing Value as Error", "1st Index
Variable" and "2nd Index Variable".
Note: The first two arguments are text strings and require double quotes. VAR_NAME would also need to be in double
quotes because it is not the name of an actual variable.
If for the Index Variable arguments you wish to use the values calculated for particular variables rather than the names
themselves, they should not be entered in double quotes.
For more information about the use of Prophet’s READ functions, refer to the Prophet Professional Help.
Creating the generic table

You will now set up the generic table INIT_COM.FAC.
1. On the Home tab click the arrow below Open, point to Open Table and then click TABLES\INIT_COM.FAC.
The following dialog appears:
2. Click OK. The New Table dialog box appears.

3. Click OK. The Properties dialog box appears.
4. Edit the dialog box to look like this:
5. Click OK. The new generic table appears in the main work area with the specified number of rows and columns.
Entering data into the empty generic table

The following table of commission rates as set out at the start of Lesson 1 covers policy terms of between 5 and 30 years:
Policy Term in Years Initial Commission %

5 10
10 25
15 35
20 - 30 40
1. Enter POL_TERM_Y as the header of the first column.
Tip: To adjust the width of a column, drag its right-hand edge in the header area and update the contents of the
table by pressing F9.
2. Enter IC_RATE_PC as the header of the second column.
3. In the first column, enter all the possible values - that is, every number from 5 through to 30.
Tip: The easiest way to do this is to enter 5 in the first row below the header and 30 in the last row. Select all the
rows and on the Table tab click the arrow below Fill, then click Interpolate Values.
4. In the second column, enter the commission rates that correspond to each premium paying term, interpolating where
necessary.
Lesson 5 - Updating libraries and products Viewing scenarios that show the effects of product changes 75
Tip: Select the cell you want to replicate and on the Table tab click the arrow below Fill, then click Replicate Down
to copy the number from year 20 to 30.
The table should now appear as follows:
5. On the Table tab click Save. The Save As dialog box appears.
6. Ensure that the details are as shown, then click OK.
7. In the main work area close the table, then on the Home tab click Save to save the product.
Viewing scenarios that show the effects of product changes

In this section you will see how you can check the effects of the changes you have made.
The effect of making the mortality rates sex dependent

To demonstrate the effect of making the mortality rates sex dependent, create a new model point file based on the existing
one.
1. In the Explorer pane in the Model Components pane expand the product, expand the Model Point Files folder and
then the Extension: .RPT folder.
2. Open c_endt.rpt.
3. On the Table tab in the Update group, click Add Variables.

Lesson 5 - Updating libraries and products Viewing scenarios that show the effects of product changes 76
The Product Scan Options dialog box appears.
4. Click OK to accept the default settings.
You can see the variable VALN_SERIES has been added to the far right of the model point file.
5. Add a second model point (represented by a row in this table.)
Tip: Right-click in the table and on the menu click Add Row.
6. Edit the table so the values are as follows:
Variable Model Point 1 Model Point 2

SPCODE 1 2
AGE_AT_ENTRY 30 30
SEX 0 1
POL_TERM_Y 10 10
ANNUAL_PREM 170 160
PREM_PAYBL_M 120 120
PREM_FREQ 1 1
SUM_ASSURED 2000 2000
DURATIONIF_M 79 79
INIT_POLS_IF 1 1
MTHS_TO_SALE 0 0
VALN_SERIES 0 0
The first model point represents a policy for a male, and the second represents a policy for a female. Note that the lower
annual premium for females reflects the lower expected mortality rates.
7. On the Table tab click the arrow below Save and click Save Table As, and save the table as c_endt.002.
The effect of the valuation series

To demonstrate the effect of the valuation series, add another model point to C_ENDT.002.
1. Add another row to the table and enter the following details:
Variable Model Point 3

SPCODE 3
Lesson 5 - Updating libraries and products Identifying an error in the run 77
Variable Model Point 3

AGE_AT_ENTRY 30
SEX 0
POL_TERM_Y 10
ANNUAL_PREM 170
PREM_PAYBL_M 120
PREM_FREQ 1
SUM_ASSURED 2000
DURATIONIF_M 79
INIT_POLS_IF 1
MTHS_TO_SALE 0
VALN_SERIES 1
2. Save and close the table, then save the product.
3. Run the product.
Tip: In the Explorer pane select the product, on the Home tab click Run, then in the dialog box click OK.
We have deliberately omitted a stage in this process in order to create an error in the run, which you can trace in the next
section. Can you identify the error now?
Identifying an error in the run

When the product runs, the Run Monitor appears, but the run pair fails.
1. Click Run Log to open Results Viewer, and in Results Viewer click View to see the run log for the run.
2. Scroll down to see the Errors and Warnings section. You can see that the errors occur in the Execution stage.
3. Expand the Execution section and click Execution. You will see error messages similar to these:
ERROR PMP008 Variable missing from model point file

Variable VALN_SERIES cannot be found in the model point file C_ENDT.RPT.bin
Failed to initialise product
Failed to run product
Errors occurred in product: C_ENDT
These messages indicate that a variable is missing from the model point file that is being read. This has occurred
because the model point file extension in the Tables tab in the Tutorial run setting was not changed from .RPT to .002
before the product was run, so the run is looking at the wrong model point file.
Tip: It is good practice to look at the run log every time a product is run. However, if you had gone straight to
Results, the product C_ENDT would not have been available for selection, as there are no results to report on.
4. Close Results Viewer and Run Monitor.
5. To change the model point file extension, open the Tutorial run setting and on the Tables tab amend the File
Extension for Model Point Files to 002, then save and close the run setting.
6. Re-run the product and look at the results.
You can see the effect of the changes that were made by looking at the results for sub-product codes 1, 2 and 3.
Lesson 5 - Updating libraries and products Lesson summary 78
Lesson summary
In this lesson you have added a new variable to a library and used that new variable in your product to implement the
enhancements suggested in an earlier lesson.
You have used the Formula Wizard to edit formulas, and Product Design View to examine the relationship between
variables.
Finally you have further practiced identifying and resolving errors.
Conclusion
You have now completed the Introduction to Prophet Tutorial and should be ready to tackle some real tasks using Prophet.
To learn more about Prophet:

n Work through the Model Office Tutorial. This tutorial introduces you to a number of other features which include:
n New business processing.
n Accumulations.
n Summary library.
n Prophet Excel Reporting.
n Grouping of model point data in Prophet.
n Work through the Data Conversion System tutorial.
n Use Help or the Prophet Professional User Guide. At any time you can look at the Prophet Professional User Guide or
Help file for more information on the Prophet interface. To do this, click the File tab and on the backstage view click
Help.
To view the online help, click Help Topics, or to view the user guide as a PDF file, click User Manuals and then double-
click the PDF for the Prophet Professional User Guide.
n Refer to actuarial documentation. This supplies detailed information on Prophet libraries, indicators and variables. To
view the actuarial documentation, Click the File tab and on the Backstage view click Global Actuarial
Documentation. You can also view context-sensitive actuarial documentation by opening the Context Actuarial
Documentation pane at the bottom of the screen.
n Finally, experiment with the system and the calculations you can set up.
79
Part 2 - Appendices
Appendix A - Further topics 80
Further topics
TOPICS IN THIS APPENDIX
Regenerating products 81
Re-scanning products using Auto-Scan 81

Appendix A - Further topics Regenerating products 81
Regenerating products
The Prophet regeneration option forces code for one or more products to be regenerated when they are next included in the
calculation run.
Regeneration should be used in the following cases:

n If changes made in the library only affect core variables then those changes will only be reflected in the products when
they are next regenerated. Using the Regenerate option means that you do not have to re-scan each of the products
concerned. However, you will still need to do this if any of the library changes affect input variables.
n If libraries and products, but not the compiled product executable files, are copied between computers.
n If a new release of Prophet is installed which requires the code to be regenerated to enable new features.
To regenerate one or more products:

1. In the Explorer pane, select the product and on the Home tab in the Run group click Regenerate. The following
confirmation appears.
2. Click OK to regenerate the product.
Re-scanning products using Auto-Scan

This option allows you to automatically re-scan products without having to select each one individually. It has the same
effect as opening each product in turn, clicking Re-Scan and saving the product. There are two main reasons why you
might want to use the Auto-Scan option:
n To bring a new input variable into the products, where the default definition is the required one for each product.
n To remove an input variable from products if it is no longer required.
To re-scan products:
1. In the Explorer pane select a product, then on the Object tab, in the Product group, click Auto-Scan.
The Select Products for Auto-Scan dialog box appears.
2. Highlight a product and use the arrows to move products between the Available Products and Selected products list,
then click OK to start the scan.
Appendix A - Further topics Re-scanning products using Auto-Scan 82
3. In the confirmation dialog box click OK.

Appendix B - Conventional product input files Model point files 83
Conventional product input files
This section contains the details for the model point, parameter and global file for the C_ENDT product to help you
understand and identify any mistakes that may have been made.
Model point files
Parameter file
Global file
Appendix C - International product input files Model point files 84
International product input files
This section contains the details for the model point, parameter and global file for the I_ENDT product to help you
understand and identify any mistakes that may have been made.
Model point files
Parameter file
Global file

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Prophet

Enterprise-wide Actuarial Modelling

Introduction to Prophet Tutorial

FIS Prophet Main switchboard: +44 (0)1932 757 575

Part 1 - Prophet Professional Tutorial 1

1 - Setting up a simple product 6

2 - Setting up model point files and tables 29

3 - Setting up, running and reporting on a product 38

4 - Reporting on dependencies in Diagram View 55

5 - Updating libraries and products 63

B - Conventional product input files 83

C - International product input files 84

Part 1 - Prophet Professional Tutorial

Welcome to the Prophet Professional tutorial

n Asset liability modelling

n Stochastic modelling and

About this tutorial

This tutorial consists of the following lessons:

Setting up a simple product

Setting up test model point files and tables

Setting up, running and reporting on a product

Reporting on dependencies in Diagram view

Maintaining an actuarial library and updating the product

Conventional and International reference sections

Tables used by products

Setting up a simple product

TOPICS IN THIS LESSON

Starting Prophet and creating a new workspace 7

Creating the product 9

Selecting the indicators 10

Specifying the input variables 13

Saving the product 25

This lesson includes the following objectives:

1. Starting Prophet and creating a new workspace.

2. Creating the product.

3. Selecting the indicators.

4. Specifying the input variables.

Starting Prophet and creating a new workspace

The Prophet Start page appears.

3. Click Create New Workspace.

The Create New Workspace dialog box opens.

You have now completed objective 1 for this lesson.

Creating the product

To create the product:

The Product Properties dialog box appears.

3. Complete the details in the Product Properties dialog box as follows:

Name n If you are using the Conventional library, type C_ENDT.

n If you are using the International library, type I_ENDT.

Note: The product name cannot be longer than 22 letters.

You have now completed objective 2 of the lesson.

Selecting the indicators

n The Indicator Category pane displays a brief description of the category.

SOLV_MARGIN is included in the list of selected indicators.

Specifying the input variables

Variable Description Action

In the Formula Definition pane the formula definition references PER_TO_

ANN_PREM_PP Annual n On the Design tab click Next.

ANNUAL_PREM Annual n On the Design tab click Next.

7. On the Design tab, click Change Definition Type.

The Definition Type dialog box appears.