Course co-ordinator(s): Peter Ridges (Edinburgh).
Aims:
To extend the coverage of F71AF Life Insurance Mathematics 1 and to include further material for Subject CM1 of the Faculty/Institute of Actuaries examinations.
Summary:
In this course you will learn how to deal with questions involving:
- Multiple-life actuarial functions
- Disability contracts, long-term care contracts and related computations
- Heterogeneity and selection
- Population projections and indices
- Profit testing of conventional and unit-linked life insurance polices<li>
Detailed Information
Course Description: Link to Official Course Descriptor.
Pre-requisites: none.
Location: Edinburgh.
Semester: 2.
Learning Outcomes: Subject Mastery
At the end of studying this course the students should be able to:
- Multiple-life actuarial functions;Derive the distribution functions, density functions and moments of random variables representing joint lifetimes. Derive and evaluate probabilities, and monetary functions (joint life annuities, joint life assurances, contingent assurances, reversionary annuities) associated with joint lifetimes. Formulate simple joint life models in terms of multiple state models.
- Disability contracts, long-term care contracts and related computations;Describe policy designs features. Understand the Multiple state model formulation of disability contracts (Markov and semi-Markov models).
- Heterogeneity and selection;Understand possible sources of heterogeneity and methods of analysing data for heterogeneity.
- Demographic Topics;Construct single figure and other indices to represent features of data sets. Understand the strengths and weakness of various indices. Understand and construct models of population projections.
- Profit Testing:calculate the profit vector, profit signature, net present value, profit margin, discounted payback period, and internal rate of return for conventional policies,describe the effect on the profit vector of changes in the premium, valuation, and experience bases,
- Describe the operation of the unit price and the charging structure for unit-linked policies,
- Calculate the unit fund, sterling fund, and measures of profit for unit-linked policies.
Reading list:
There is no standard textbook for this course.
However you may be interested in:
Actuarial Mathematics for Life Contingent Risks by Dickson, Hardy and Waters.
In addition, Formula and Tables for Actuarial Examinations are needed. The current issue was published in 2002 and has yellow covers. The previous edition was published in 1980 and has green covers. The old edition will be needed for some past papers and tutorial questions: it is available online at:
http://www.actuaries.org.uk
SCQF Level: 11.
Credits: 15.
Other Information
Help: If you have any problems or questions regarding the course, you are encouraged to contact the course leader.
Canvas: further information and course materials are available on Canvas