Not sure how many people who watch the insurance space or do insurance modelling here, but I'll post my question here nonetheless.
I am working on some appraisal valuation of a life insurance company. As usual, we would go by Embedded Value + PV of Value of New Business, with VNB valued by individual channels (agency, bancassurance, etc). My question is, do we ever project VNB to reach a terminal value, especially for agency channels?
I heard actuarials never do that because there is no right way to assume the VNB margin at terminal value, but never understood why.
Thoughts?
