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Contingencies (ACTL30003)

Undergraduate level 3Points: 25On Campus (Parkville)

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Year of offer2019
Subject levelUndergraduate Level 3
Subject codeACTL30003
Semester 2
FeesSubject EFTSL, Level, Discipline & Census Date

Topics include traditional life insurance products; present values of annuities and assurances for single lives; net and gross premiums and policy values; select mortality; joint life theory; cashflow models; competing risks; discounted emerging costs; multiple decrements; guarantees and options; risk classification.

Intended learning outcomes

  • Define simple assurance and annuity contracts, and develop formulae for the means and variances of the present values of the payments under these contracts, assuming constant deterministic interest.
  • Describe practical methods of evaluating expected values and variances of the simple contracts defined in the above objective.
  • Describe and calculate, using ultimate or select mortality, net premiums and net premium reserves of simple insurance contracts.
  • Describe the calculation, using ultimate or select mortality, of net premiums and net premium reserves for increasing and decreasing benefits and annuities.
  • Describe the calculation of gross premiums and reserves of assurance and annuity contracts.
  • Define and use straightforward functions involving two lives.
  • Describe methods which can be used to model cashflows contingent upon competing risks.
  • Describe the technique of discounted emerging costs, for use in pricing, reserving, and assessing profitability.
  • Describe the principal forms of heterogeneity within a population and the ways in which selection can occur.

Generic skills

  • High level of development: written communication; problem solving; statistical reasoning; application of theory to practice; interpretation and analysis; synthesis of data and other information; evaluation of data and other information; use of computer software.

Last updated: 12 July 2019