Actuarial Science

The classical mortality models such as the Cairns-Blake-Dowd (CBD), Lee-Carter (LC), Linear Regression (LR) models are used to model Systematic Mortality Risk (SMR) for many developed countries populations for actuarial product valuations. This research study aims at incorporating the Bühlmann credibility approach (BCA) to improve the SMR models to fit sub-Saharan African populations like Kenya. Since the Kenyan population does not exhibit the Gaussian properties used in modeling the classical error terms, we proposed using Normal Inverse Gaussian distribution to model these error terms instead of a Gaussian distribution. We model the error terms of the classical models (LC, CBD, and LR) as a Normal Inverse Gaussian (NIG) distribution through the Bühlmann credibility approach. This novel approach demonstrates an improved precision of the predicted SMR as shown by the values of MAPE and RMSE measures compared to those under classical mortality risk models. Ultimately, we have done actuarial valuations of annuities and assurances using our determined SMR, thus concluding that this BCA approach improves the accuracy of actuarial products sold in the Kenyan market.

Investasi pada saham dianggap memiliki tingkat risiko yang lebih besar dibandingkan dengan alternatif investasi lain seperti obligasi, deposito, dan tabungan. Oleh karena itu, investor sangat membutuhkan informasi dari pergerakan indeks harga saham pada Bursa Efek. Untuk melihat perkembangan pasar modal Indonesia salah satu indikator yang sering diguakan adalah Indeks Harga Saham Gabungan (IHSG). IHSG  dalam perkembangannya sangat rentan terhadap kondisi makro ekonomi secara umum. Penelitian ini bertujuan melihat bagaimana pengaruh faktor-faktor makro ekonomi yaitu nilai tukar rupih/USD (kurs), inflasi dan BI rate terhadap perubahaan nilai IHSG pada Bursa Efek Indonesia.Objek dalam penelitian ini adalah IHSG, nilai tukar rupih/USD (kurs), inflasi dan BI rate yang diambil dari statistik bulanan dengan nilai harga penutupan setiap bulan pada periode Januri 2011-Desember 2016. Data yang digunakan dalam peneitian ini adalah data sekunder yang diperoleh dari Bursa Efek Indonesia, dan sit...

Actuarial education curriculum development has been a delicate balancing act that requires actuarial pedagogical experience in achieving coherent knowledge progression and the blending of Core Actuarial Science techniques with parent department courses in insurance, finance, mathematics and statistics. This paper presents insights on Actuarial Profession exemptions for University Actuarial Science Degree Programmes. Based on some more than 14 years of teaching actuarial science, most of which having been at the National University of Science and Technology (NUST) and The University of Zambia (UNZA) since 2016 and Tanzania since 2018. The NUST B.Comm. Actuarial Science programme (Est. 1995) has run without the subject based exemption agreement since year 2009, albeit with above average student Institute and Faculty of Actuaries (IFoA) board exams pass rate and progression. The question of whether the goal of undergraduate actuarial is to produce a qualified actuary is one that is answered by around 20% of NUST Actuarial graduates of the past first decade graduates and has been rising and touched 50% once. There is however evidence that even the average actuarial science university graduate has above par analytical skills and core knowledge to excel in the wider financial sector, be it in Risk, Banking or Investment profession prompting the need for individual actuarial students to make the switch as and when there is still fulfillment. Academic and professional goals in curricular do conflict  and apart from diversity in academic teaching delivery there is need to uphold the notion of ‘one actuarial standard’ whose content and examination standard follows the leading professional actuarial bodies (IFoA, SOA, IAI, ASSA, etc.) especially for the Core Principles regardless of the exemption status. The presentation of the dominant IFoA in Actuarial Science programmes in the region has varied depending on; the nature of knowledge blending i.e Sciences(mathematics) or Commerce (finance), the available skills to deliver the content, the quality of students and the state of higher education quality assurance.

The following observations arise:
1. Any future Actuarial Science degree programme should be a blend between the core actuarial subjects and the mathematical, computational and wider fields
2. Given that the principal motive is to contribute to the development of the Actuarial Profession in Zambia, a mapping of how the International Actuarial Association (IAA) or Institute and Faculty of Actuaries (IFoA) professional curricular 
3. This curriculum is coming after the 2019 changes to the IFoA examinations and also the course structure and coverage which presents the need to be as much as possible upto date with the current developments.

As I have an interest on private sector, I was forwarded to Dushtha Shasthya Kendra (DSK) , a renowned NGO in Bangladesh. I started the internship there from June, 2019 under the faculty-supervision of Professor Dr. A. K. M. Moniruzzaman, Department of Management Studies, Jagannath University.
As per my Supervisor’s direction the topic of the report has been chosen as “Compensation and Benefit Systems of Dushtha Shasthya Kendra (DSK).”

I did my internship in Dushtha Shasthya Kendra, which work for increasing livelihood of low income community people. Though I am an employee of Dushtha Shasthya Kendra, but this internship gave me the opportunity to know the organization from different aspects. Currently I involved with “LIC Project under the framework of Saidabad Phase-III” which is funded by European Union, AFD and DWASA. Apart from regular activities I had some specific job duties and responsibilities due to my Internship. I performed those job duties and responsibilities perfectly and enrich my professional knowledge regarding compensation and benefit systems in NGOs.

The actuarial profession in India was brought up by British rulers in pre-independent India to use actuarial knowledge and qualifications to run private insurance companies.  Mr. L.S. Vaiydyanathan was the first Indian qualified actuary from the Institute of Actuaries UK. He was the first person from India to get published his paper “Mortality of Indian Assured Lives” in 1939. The foundation of Indian Actuarial Profession was laid down in 1944 with the formation of Actuarial Society of India (ASI). The profession further got admitted into the International Actuarial Association in 1979. The first initiative towards the development of examination through ASI started by conducting entrance examination for student membership of Institute of Actuaries, UK in 1975.

This is a summary of the numbered formulas and end of chapter concepts for EXAM MLC - Models for Life Contingencies.

Details of Reference:
Book Title: Study Manual for SOA Exam MLC Life Contingencies
Edition: 14th
Author of Reference: Abraham Weishaus, PhD, FSA, CFA, MAAA

For erratum, please let me know.

Thanks!
Monica Revadulla

Il s’agit de valorisation et de couverture des options de type américaine dans le cas d’une évolution temporelle discrète.
•Le modèle adopté est celui de Cox-Ross-Rubinstein ; dont la description pour les options américaines fera l’objet de la première partie
•Les calculs algorithmiques se ferons sous le logiciel R, appuyé des packages fOptions et OptHedging, en deuxième partie.

Resumen
El presente artículo académico referente al impacto del Big Data en los individuos se realizó a partir de la revisión de artículos especializados y libros con contenido alusivo al tema en cuestión. El Big Data es una herramienta de análisis de datos masivos que, desde la llegada del internet, ha ido creciendo día con día; si bien es cierto que con este instrumento se pueden obtener grandes beneficios, como el de diagnosticar un virus únicamente relacionando la información de los patrones de búsqueda de las personas en Google, también puede traer circunstancias críticas, como influir en una elección política que impacte a todo un país. Esto representa riesgos; pues da lugar a que se presenten posibles situaciones negativas por datos mal encausados y llegar hasta atentar con la privacidad y protección de los datos personales de los usuarios. La información de las personas es, para las empresas capitalistas, uno de sus mejores instrumentos para conseguir ventas impresionantes, por lo que podrían llegar a conseguir esos datos a toda costa. Dicha situación pone en peligro al individuo y toda persona que navegue por internet podría ser víctima de estos riesgos. Es por eso, que el presente artículo recalca la importancia del tema, busca abrir espacios de análisis y reflexión especialmente en los riesgos involucrados, así como presentar posibles alternativas viables para su minimización.

Abstract
The present academic article referring to the impact of Big Data in people was written based on the revision of specialized documents and books with content related to the presented topic. Big Data is an analysis tool of massive data, that since the arrival of the internet, it has been growing day by day; it is truth that with this instrument you can obtain huge benefits, as the one obtained by diagnosing a virus only relating the information of people's search patterns on Google, but it could also bring out critic situations such as influencing a complete politic election that impacts an entire country, these conditions represent hazards; and gives place to possible negatives situations by the unmoral use of this data and also endangers user's privacy and personal data. People's information is, to the capitalist companies, one of the best instruments to sell in an impressive way, that is the reason why these enterprises could obtain data in any way despite the methods. The situation endangers the person and all people that surfs thru the internet could be victim of those dangers.

Dans le but d’aider BELIFE INSURANCE à améliorer mieux appréhender le risque de rachat dans sa gestion actif-passif, et compte tenu de la demande massive de rachats totaux dont elle a fait l’objet, nous entreprenons la recherche d’un modèle adapté de prévision.
Ainsi la recherche de ce modèle de prévision, passe par une définition de notions théoriques de bases suivi d’une analyse comportementale du portefeuille
En outre, La durée de vie du contrat est essentielle à la rentabilité de celui-ci. Cette rentabilité ne dépend pas seulement de sa sinistralité. Il est donc nécessaire de conserver ses affaires en portefeuille plusieurs années afin de les rentabiliser. Dans ce travail, nous nous sommes intéressés à la modélisation de la durée de vie des contrats d’assurance vie avant leur rachat. L’idée de l’étude est d’expliquer les chutes des contrats d’assurance vie par les variables qui peuvent avoir une influence sur celles-ci. Notre analyse consiste donc à évaluer la durée de vie des contrats d’assurance vie en tenant compte de toutes les informations disponibles dans nos bases de données.
En dernier lieu, proposer un modèle optimal applicable au sein de BELIFE INSURANCE en vue de prévoir les sorties du portefeuille sous forme de rachats.

Many actuarial Science Students in Kenya often struggle to find research topics whenever they want to do their researches in the Universities. This Paper should give you an Overview of some of the best topics to choose when doing research at the end of the University course work.

Uganda is one of the countries with the largest number of traffic accidents and fatality rate, and the share of fatalities in its urban centre’s quite significant.
Pedestrians, the disabled, children and the aged in particular, are the major victims of these accidents.  However drivers of vehicles themselves are almost always victims.
This study sought to identify the variables that mainly contribute to per annum fatalities and hence to describe the effect of vehicle type, weather conditions, road conditions as well as time of the day and how the fatalities vary as the above variables change.
Poisson regression and the negative binomial regression analysis are used in this study.  Findings of this study have shown that weather conditions do not significantly predict road accident fatalities while the type of vehicle; road conditions and time of the day significantly affect the number of fatalities per annum. 
People travelling on roads with potholes have a higher risk of being involved in fatal accidents. This risk is 3.67 times higher than those moving on roads with dry conditions.
The study also shows that motor cars and motorcycles (bodabodas) were involved in the most crashes over the 9 year interval. The per annum fatalities are 58.9 and 43.9 times higher than those caused by fuel tracks respectively.
People travelling between 4:00pm-8:00pm (rush hour) are liable for most of the accidents including the fatal ones. The fatalities during this time interval are 4.14 times higher than those occurring between 12:00am-4:00am.

The insurance trade in Zambia has seen incredible swing in the manner in which the business is shepherded having relocated from a monopoly in the pre-liberalization epoch to a free market after the liberalization of the economy in 1992. The aim of this study is to find out how cash flow risk management affects financial performance of insurance companies in Lusaka, Zambia (Multivariate Analysis)
The existing research employed a descriptive research enterprise to study the influence of risk management on financial performance of four insurance firms in Zambia; Sanlam Life Insurance, Madison Insurance Zambia, ZSIC, Prudential Insurance Zambia. This sort of information is eagerly accessible in the annual reports of the four firms and LUSE published handbooks. The information attained from financial reports contains; firm’s annual net income, total liabilities, claims incurred and premium earned, premium ceded and total assets, current assets and liabilities.
The results of this study ascertained that; this model can be shortened as a one-percent upsurge in the financial risk management outcomes to a decrease in the financial performance of the firm (ROA) by 1.0%, a 1% augmentation in the operational risk management will similarly decrease ROA by 77.3% while a surge in enterprise risk management by 1% will decrease the performance of the company by 1.5%. Furthermore, an upsurge in financial leverage primes to a 55.1% reduction on ROA. While an upsurge in firm size by one unit will surge ROA by 11% and 2.8% respectively
This research concentrated on cash flow risks and financial performance of top four insurance companies in Zambia and depended on secondary information. A study where information gathering depends on primary information i.e. thorough questionnaires and interviews covering all the top four insurance firms in Zambia is suggested so as to accolade this study.

It is generally accepted that people’s economic-choice behavior is motivated by the utility they derive from actual or expected consumption of real goods. The ratio of marginal utility from any such consumption today as opposed to the marginal utility of future consumption leads to real interest rates, and to relative prices denominated in units of consumption goods (or, utils per consumption). But, trading is done with prices given in terms of money. This intertemporal preference for consumption denominated in monetary terms is the basis for interest rate behavior. Thus, while consumption unit prices reflect people’s choices regarding intertemporal consumption behavior, in order to study the true consumption choices one needs to know how the prices denominated in consumption units are related to the money prices. Naim Sipra is also an author. Department of Finance, University of Colorado at Denver, Denver, Colorado

The National Disability Insurance Scheme is one of the most significant welfare reforms Australia has seen in a century. The reform incorporates several themes that have been gaining traction in other countries, including individual budgets and actuarial (or social investment) approaches. This chapter provides an overview of NDIS and an analysis of its more unusual attributes within the broader personalization agenda. In particular, we assess the use of actuarial approaches and their implications for the administration of the scheme. At the heart of the scheme sits a tension between the unusually prominent role given to actuarial methods (which are typically used for monitoring and forecasting costs) and the fundamental objective of achieving the best possible outcomes for people with a disability (taking account of value-for-money constraints). Introduction The National Disability Insurance Scheme (NDIS) is one of the most significant welfare reforms that Australia has seen in a century. In addition to providing a major funding injection into disability services, this reform incorporates several themes that have been gaining traction in other countries. First, the NDIS reform harnesses market forces with budgets delegated to individuals as a way of driving choice and control for people with a disability. Rather than using a 'one size fits all' service, individuals can (in principle) choose services that meet their needs (Anttonen 2012), which is argued to improve wellbeing (LeGrand 2007). Second, the scheme is based on an actuarial model of disability services and principles of social investment (Needham and Dickinson 2017). Such an approach views early intervention and targeted investment in certain support services as a way of improving outcomes for an individual and reducing overall lifetime expenditure across a number of different parts of government. This chapter provides an overview of the emergence of this new scheme and focuses on its more unusual attributes within the broader personalization agenda – the use of actuarial approaches and their implications for the administration of the scheme. We start by providing some context and background on actuarial approaches in social policy and the NDIS, before moving on to examine how the actuarial approach is functioning in the scheme. In particular, we consider how social and economic outcomes will be valued and we summarize some of the administrative challenges of the scheme. We argue that at the heart of the scheme sits a tension between the unusually prominent role given to actuarial methods (which are typically used for monitoring and forecasting costs) and the fundamental objective of achieving the best possible outcomes for people with a disability (taking account of value-for-money constraints).

This paper considers the modelling of a life table model for Ghana when her population becomes stable in the future. To do this, a Leslie matrix for Ghana is first determined. The Leslie model (which is an age-structured population projection matrix) is used to find the asymptotic growth rate, stable population and the stable age distribution (which forms the basis for actuarial computations). Life tables are computed from the stable age distribution and the survival curve compared with survival curves of other life tables to see the disparities. A life table (or mortality) model is estimated by fitting the survival curve of the generated life table to already existing mortality models. Ghana's mortality model has been found to follow the modified De Moivre distribution with an estimated survival function í µí±†í µí±†(í µí±¥í µí±¥) = �1 − í µí±¥í µí±¥ 90 , 0 ≤ í µí±¥í µí±¥ < 90. It has been found that Ghana's population would attain stability by the year 2030 with an estimated population of 43.8 million; comprising 49.6 percent males and 50.4 percent females. Life expectancy has been estimated to be 58years for males and 60years for females. Annual growth rate has been estimated to be 1.21%.

A typical problem faced by small business entrepreneurs is to estimate - with reasonable probability - if their business will succeed or fail. This computational model allows them to evaluate the risk of investing in a business project, using financial tools, statistical and simulation, to answer questions of interest to the future of a business. The model is designed to require some input data (INPUTS), key information to process the project feasibility analysis. Once entered, the model will perform a run process through computer tools simulating each variable and estimating the expected results of the business (OUTPUTS). Through dynamic simulation technique, the model will be able to calculate up to 10,000 scenarios and possible outcomes for the business, leading to a conclusion - with reasonable probability - if the project is financially viable or not. The model will provide the results of the scenarios at the OUTPUTS section. This will allow the entrepreneurs to appreciate more clearly the likelihood of success of their business and to evaluate – on a technical basis - whether or not starting a business or adjust their calculation assumptions, BEFORE DECIDING TO INVEST AND WITHOUT PUTTING THEIR MONEY AT STAKE.

This is a project work related to the study of Runge Kutta method of higher order and to
apply  in  solving  initial  and  boundary  value  problems  for  ordinary  as  well  as  partial
differential equations. The derivation of the fourth order and the sixth order Runge Kutta
methods  have  been  done  firstly.  After  that,  FORTRAN  90/95  code  has  been  written  for
particular problem. Numerical results have been obtained for various problems. Then we
have given the graphical representation of Runge Kutta fourth order and sixth order.
The main focus has been given on sixth order Runge Kutta method. Exact and approximate
results has been obtained and shown in tabular as well as graphical form. From the closest
investigation we observed that sixth order Runge-Kutta method gives better accuracy.

In recent years, typhoons have struck the Philippines and Vanuatu; earthquakes have rocked Haiti, Pakistan, and Nepal; floods have swept through Pakistan and Mozambique; droughts have hit Ethiopia, Kenya, and Somalia; and more. All led to loss of life and loss of livelihoods, and recovery will take years. One of the likely effects of climate change is to increase the likelihood of the type of extreme weather events that seems to cause these disasters. But do extreme events have to turn into disasters with huge loss of life and suffering?

Dull Disasters? harnesses lessons from finance, political science, economics, psychology, and the natural sciences to show how countries and their partners can be far better prepared to deal with disasters. The insights can lead to practical ways in which governments, civil society, private firms, and international organizations can work together to reduce the risks to people and economies when a disaster looms. Responses to disasters then become less emotional, less political, less headline-grabbing, and more business as usual and effective.

The book takes the reader through a range of solutions that have been implemented around the world to respond to disasters. It gives an overview of the evidence on what works and what doesn't and it examines the crucial issue of disaster risk financing. Building on the latest evidence, it presents a set of lessons and principles to guide future thinking, research, and practice in this area.

We conducted an international survey in which forensic examiners who were members of professional associations described their two most recent forensic evaluations (N=434 experts, 868 cases), focusing on the use of structured assessment tools to aid expert judgment. This study describes: (a) the relative frequency of various forensic referrals, (b) what tools are used globally, (c) frequency and type of structured tools used, and (d) practitioners’ rationales for using/not using tools. We provide general descriptive information for various referrals. We found most evaluations used tools (74.2%) and used several (on average 4). We noted the extreme variety in tools used (286 different tools). We discuss the implications of these findings and provide suggestions for improving the reliability and validity of forensic expert judgment methods. We conclude with a call for an assessment approach that seeks structured decision methods to advance greater efficiency in the use and integration of case-relevant information.
Keywords: judgment; decision; forensic; structure; actuarial

El 21 de junio de 2018 marcó el inicio de actividades de la Licenciatura en Actuaría en la IBERO, un programa que desde su planeación buscó integrar la esencia de las guías educativas del Syllabus actuarial emitido por la International Actuarial Association (IAA); cuya última versión data del mes de octubre de 2017 y es revisada cada cinco años por la IAA con el fin de incorporar el continuo desarrollo profesional. Actualmente el Syllabus actuarial es considerado el estándar educativo a nivel internacional por lo que las Instituciones de Educación Superior (IES) se encuentran sumamente interesadas en su cumplimiento, ya que les permite identificar y desarrollar nuevos tópicos educativos conforme se expande el campo de trabajo del actuario.

This is a summary of the numbered formulas and end of chapter concepts for EXAM MLC - Models for Life Contingencies.

Details of Reference:
Book Title: Study Manual for SOA Exam MLC Life Contingencies
Edition: 14th
Author of Reference: Abraham Weishaus, PhD, FSA, CFA, MAAA

For erratum, please let me know.

Thanks!
Monica Revadulla

Primary background research documents developed and presented in 1998 when carrying out a review of public policy options for the Peruvian AFP system.  Hitherto unpublished, but likely of interest to international actuaries, insurance and retirement/pensions specialists, especially relating to practices in Chile, Peru, Colombia, Mexico, Uruguay, Bolivia and Argentina.  The latter two countries have since wound up their individual DC pension  programs, but the others are still active - although the conditions may not be current.