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ACSC13-301: Contingencies

Description

This subject develops mathematical techniques which can be used to model and value cash flows that are dependent on events such as death, survival, illness and retirement. Specific topics include defining assurance and annuity contracts, evaluating expected values and variances of the present values of payments under these contracts, calculating net premiums and net premium reserves of insurance contracts, techniques to deal with contracts that involve two lives, pricing, profit-testing and cash flow projections of conventional and unit-linked products.

Subject details

TypeUndergraduate
CodeACSC13-301
EFTSL0.125
FacultyBond Business School
Semesters offered
  • May 2018 [Standard Offering]
Credit10
Study abroadAvailable to Study Abroad students
Study areas
  • Actuarial Science
Subject fees
  • Commencing in 2017: $4,205
  • Commencing in 2018: $4,247

Learning outcomes

1. 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.
2. Describe the principal forms of heterogeneity within a population and the ways in which selection can occur.
3. Describe and use practical methods of evaluating expected values and variances of the simple contracts.
4. Describe and calculate, using ultimate or select mortality, net premiums and net premium reserves of simple insurance contracts.
5. Describe and calculate, using ultimate or select mortality, net premiums and net premium reserves for increasing and decreasing benefits and annuities.
6. Describe and calculate gross premiums and reserves of assurance and annuity contracts.
7. Define and use functions involving two lives.
8. Describe and illustrate methods of valuing cash flows that are contingent upon multiple transition events.
9. Describe and use methods of projecting and valuing expected cash flows that are contingent upon multiple decrement events.
10. Describe and use projected cash flow techniques for use in pricing, reserving, and assessing profitability.

Prerequisites

Students must have successfully completed ACSC12-201 Financial Mathematics or equivalent as well as 120 Credit Points of their program prior to undertaking ACSC13-301 Combined Degree students must have completed 120 Credit points from the Actuarial part of their program

Subject outlines

Subject dates

Standard
Enrolment opens19/03/2017
Semester start15/05/2017
Subject start15/05/2017
Cancellation 1?29/05/2017
Cancellation 2?05/06/2017
Last enrolment28/05/2017
Last withdrawal?09/06/2017
Teaching census?09/06/2017