Includes bibliographical references (p. [367]-368) and index.

Preface. Notation index. PART I: THE DETERMINISTIC MODEL. 1. Introduction and motivation. 1.1 Risk and insurance. 1.2 Deterministic versus stochastic models. 1.3 Finance and investments. 1.4 Adequacy and equity. 1.5 Reassessment. 1.6 Conclusion. 2. The basic deterministic model. 2.1 Cashflows. 2.2 An analogy with currencies. 2.3 Discount functions. 2.4 Calculating the discount function. 2.5 Interest and discount rates. 2.6 The constant interest case. 2.7 Values and actuarial equivalence. 2.8 The case of equal cashflows. 2.9 Balances and reserves. 2.10 Time shifting and the splitting identity. 2.11 Change of discount function. 2.12 Internal rate of return. 2.13 Standard notation and terminology. 2.14 Spreadsheet calculations. 2.15 Notes and references. Exercises. 3. The life table. 3.1 Basic definitions. 3.2 Probabilities. 3.3 Constructing the life table from the values of qx. 3.4 Life expectancy. 3.5 Choice of life tables. 3.6 Standard notation and terminology. 3.7 A sample table. 3.8 Notes and references. Exercises. 4. Life annuities. 4.1 Introduction. 4.2 Calculating annuity premiums. 4.3 The interest and survivorship discount function. 4.4 Guaranteed payments. 4.5 Deferred annuities with annual premiums. 4.6 Some practical considerations. 4.7 Standard notation and terminology. 4.8 Spreadsheet calculations. Exercises. 5. Life insurance. 5.1 Introduction. 5.2 Calculating life insurance premiums. 5.3 Types of life insurance. 5.4 Combined benefits. 5.5 Insurances viewed as annuities. 5.6 Summary of formulas. 5.7 A general insurance-annuity identity. 5.8 Standard notation and terminology. 5.9 Spreadsheet applications. Exercises. 6. Insurance and annuity reserves. 6.1 Introduction to reserves. 6.2 The general pattern of reserves. 6.3 Recursion. 6.4 Detailed analysis of an insurance or annuity contract. 6.5 Bases for reserves. 6.6 Nonforfeiture

Actuarial work is the application of mathematics and statistics to the analysis of financial problems in life insurance, pensions, general insurance and investments. This unique introduction to the topic employs both a deterministic and stochastic treatment of the subject. It combines interest theory and life contingencies in a unified manner as well as covering basic risk theory. Fundamentals of Actuarial Mathematics presents the concepts in an original, accessible style, assuming a minimal formal background. This book provides a complete review of necessary probability theory and covers the Society of Actuaries syllabus on Actuarial Models. It orders the topics specifically to facilitate learning, beginning with the simplest case of the deterministic discrete model, and then moving to the more complicated stochastic, continuous models. While employing modern calculation and computing techniques, such as spreadsheets, it also contains a variety of exercises, both computational and theoretical. Supported by a website featuring exercises and further examples, it is written by a highly respected academic with over 35 years teaching experience. This book will be invaluable to senior undergraduate and graduate students, as well as actuarial professionals working in the life insurance or pension fields. Applied mathematicians and economists will also benefit greatly from the clear presentation and numerous examples.