Code of Massachusetts Regulations
211 CMR - DIVISION OF INSURANCE
Title 211 CMR 39.00 - Annuity Mortality Tables for Use in Determining Reserve Liabilities for Annuities
Section 39.04 - Application of the 2012 IAR Mortality Table
In using the 2012 IAR Mortality Table, the mortality rate for a person age x in year (2012 + n) is calculated as follows:
The resulting qx2012+n shall be rounded to three decimal places per 1,000, e.g., 0.741 deaths per 1,000. Also, the rounding shall occur according to the formula above, starting at the 2012 period table rate.
For example, for a male age 30, qx2012 = 0.741.
qx2013 = 0.741 * (1 - 0.010) ^ 1 = 0.73359, which is rounded to 0.734.
q 2014 = 0.741 * (1 - 0.010) ^ 2 = 0.7262541, which is rounded to 0.726.
A method leading to incorrect rounding would be to calculate qx2014 as qx2013 * (1 - 0.010), or 0.734 * 0.99 = 0.727. It is incorrect to use the already rounded qx2013 to calculate qx2014.